Australian cookie firm counts cost of extortionist threat

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SYDNEY -- Arnotts Ltd, Australia's major cookie manufacturer 70% owned by the U.S. Campbell's group, began restocking supermarket shelves February 26 after police said an extortion threat made on February 14 had been defused. No arrest has been made.

A major corporate and branding campaign through agency George Patterson Bates is expected to begin by the weekend, to follow a carefully-engineered crisis management TV ad campaign that has been reassuring consumers there was no danger from the extortionist's threat.

Arnotts, which produces all of the country's top ten biscuit brands and held a 62% share of the $610m market segment before the extortion threat, says that after an anticipated insurance recovery and tax write- off, the cost to the company will be "at best" around $8m.

Arnotts withdrew all stock from sale in New South Wales and Queensland after the threat to poison packets on supermarket shelves was received. Leading food retailers said today they were working hard to get a full range of Arnotts back on their shelves in time for weekend shopping, with Woolworths saying it would conduct in-store promotions to help the company regain market share.

Copyright February 1997, Crain Communications Inc.

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