E.J. BRACH TO ACQUIRE BROCK CANDY

RICHARD TURCSIK

CHICAGO -- E.J. Brach Corp. here has entered into an agreement to acquire Brock Candy Co., Chattanooga, Tenn.

The transaction is expected to be completed near the end of October. The new company will be known as Brach & Brock Confections Inc. and will maintain offices in Chicago and Chattanooga.

Kevin Martin, president of Brach, will continue as president and chief executive officer of Brach & Brock Confections. Paul K. Brock, president of Brock, will be chairman.

"The complementary strengths of each company will advance Brach & Brock Confections' position in the candy market, and provide greater opportunities for continued growth and expansion," Martin said.

The acquisition looks like it will be good for both companies, according to Breck Wheeler, a securities analyst with J.C. Bradford, Nashville.

"E.J. Brach has strength in the grocery area, and Brock-Chattanooga has strength in the mass merchants, particularly with their relationship with Wal-Mart. There is the potential to share those distribution channels as well. There is also a consolidation potential with them calling on some of the same accounts," she said.

"While E.J. Brach is very dominant in the bulk candies area, Brock-Chattanooga has only done a little in that arena. Both of them are into pegged candy big-time," she said.

E.J. Brach is a private company with plants in Chicago, Sullivan, Ill., and Davenport, Iowa. It manufacturers more than 300 varieties of sugar and chocolate candies.

Publicly held Brock manufacturers and sells a variety of sugar and chocolate candies, gummy candies and fruit snacks, primarily under the Brock label.