R&R Ice Cream, Europe’s largest own label ice cream manufacturer, is joining forces with Kraft Foods to bring confectionery innovation to ice cream markets across mainland Europe. In co-operation with Kraft Foods, R&R will initially develop, manufacture and distribute an indulgent ice cream range of five iconic Kraft brands – Milka, Toblerone, Daim, Oreo and Philadelphia – across ten European markets – Germany, Austria, Switzerland, France, Italy, Spain, Portugal, Netherlands, Belgium and Luxembourg. The first products will hit the shelves in Spring 2012 and are likely to appear in an individual serve ice cream format similar to R&R’s Nestle Potz range, which has proved so successful in the UK.

“We believe this venture could achieve additional sales of some Eur100 million for Kraft branded products within five years,” says James Lambert, chief executive and executive chairman of R&R Ice Cream. “It gives us a world-leading food brand across much of Western Europe and further enhances our reputation as a one-stop shop for both branded and own label ice cream products. I fully expect the Kraft deal to transform the European business in much the same way as the 2001 acquisition of the Nestle Ice Cream business changed our UK operations.”

He continues: “R&R is in great shape for 2012. The surplus cash from last November’s Eur350 million bond will be fully invested by early next year resulting in significantly increased EBITDA and free cash flows. Our cash flow generation will also enable us to further pursue our strategy of consolidating the European ice cream market and investing in our factories to reduce costs and increase innovation for customers and consumers.”

UK-based R&R Ice Cream has expanded its French business with the Eur27m acquisition of Pilpa, the ice cream division of Maison Boncolac. Employing 154 people and operating from a factory in Carcassonne, Pilpa supplies own-label ice cream to the French supermarkets but it also active in the branded sector through products marketed under the Disney, Oasis and Pilpa brands.

The acquisition will add 23m litres of ice cream to R&R Ice Cream’s current annual production of 450m litres. The disposal will allow Maison Boncolac to focus on its frozen appetisers and patisserie businesses.

“I am delighted to strengthen our business in France with the acquisition of Pilpa and the strong brands it brings to R&R,” says James Lambert, chief executive of R&R Ice Cream. “Our French sales are now at a similar level to Germany and the UK, and we are ideally placed to benefit from the opportunities for further consolidation of the European ice cream sector.”

Created in 2006 by Oaktree Capital Management following the merging of Richmond Ice Cream with Roncadin, R&R Ice Cream is Europe’s biggest private-label ice cream manufacturer. R&R Ice Cream purchased Rolland, France’s third largest ice cream manufacturer, last year.