Founders of Bionade make for the exit
Haven’t we seen this before – a small business losing out to big business? On 1 February 2012 the founders of Bionade, Germany’s eco-soft drink label, sold their remaining 30 percent stake to food giant Dr Oetker, a EUR 2 billion food company best known for cake mixes and frozen pizzas.
The fizz started going out of the Bionade story three years ago when founder Peter Kowalsk, 44, and his family together with their partner, the Egon Schindel Holding (which owns several mineral water brands) transferred 70 percent of their shares to the Radeberger beer group, which in turn is owned by Dr Oetker.
At the time Mr Kowalsky said that hitching up with Radeberger would help their brand grow, thanks to Radeberger’s deep pockets and nation-wide distribution network.
However, joining the Radeberger portfolio of brands did not do Bionade any good. Sales continued to drop: from 200 million bottles in 2007 to 60 million bottles in 2010. In 2011 sales "almost stabilised", said Radeberger, which translates into an estimated loss of 5 percent over 2010.
In retrospect, the ill-advised 30 percent price hike in 2008 was just a symptom but not the cause of Bionade’s descent into near-insignificance. The truth of the matter is that Bionade did not resonate any longer with its core consumers: fickle right-on youth-types.
It did not help either that in an effort to boost sales Bionade was suddenly to be found on the shelves of German discount chains.
In a desperate attempt, Mr Kowalsky tried to wrestle control of the brand back from Radeberger last year by setting up a Bionade co-operative – a move which was blocked by Radeberger.
That left Mr Kowalsky with only one option: sell out completely to Radeberger.
Mr Kowalsky, a family brewer from northern Bavaria who had launched Bionade in the 1990s, did not do too badly from the sale to Radeberger. The initial 70 percent stake was valued at EUR 30 million, insiders say. The final 30 percent slice went for a song: a mere EUR 3 million, German media report.
Radeberger Group is the leading German beer and beverage company with a total sales volume of 13.2 million hl (+1% over 2010) and a turnover of EUR 1.8 billion (2010: EUR 1.6 billion).
