Krasny Oktyabr Chocolate Factory and Museum

RUSSIA: RED OCTOBER CHOCOLATE FACTORY

Russian/Nat

The Russian stock exchange is witnessing its biggest single share issue since the fall of communism.

Red October, Russia's largest and oldest chocolate factory, began a major share issue Monday that experts say will revolutionise the Russian stock market.

Over the next two weeks, the factory will sell 22 (m) million US dollars in shares - all for cash.

Set in the heart of Moscow, the Red October chocolate factory is something of a national institution.

It was set up 127 years ago by a German company and became suppliers of chocolates to the Tsar.

It was nationalised after the October Revolution.

But now with competition from Western chocolate companies, its monopoly has gone and Red October needs the income generated by the share offer.

SOUNDBITE: (RUSSIAN -21')
Our first task will be to increase our capital the lack of which is a constant factor. Of course we will use that capital to modernise the machinery, replace the old and buy new equipment to increase output.
SUPER CAPTION: Konstantin Vityenuk - chief Red October confectionery department

The factory's three-thousand employees produce over 59-thousand tons of sweets and 250 brands each year.

It is one of the best known companies in Russia and it hopes that reputation will attract investors from home and abroad.

The firm in charge of the share offer is convinced that Red October represents a sound investment.

SOUNDBITE: (RUSSIAN -19')
The investor gets a reliable and safe investment, something which no other company can guarantee. For every share they get a part of the factory so it's understood that it is not just a blank piece of paper.
SUPER CAPTION: Tatyana Nikulshina - Grant Financial Group.

The factory has also launched a spirited advertising campaign, using television to entice investors.

However, you only need to look at any street corner to see what Red October is up against.

Over the past couple of years, Western imports have flooded the Russian market and are proving popular with the public.

SOUNDBITE: (RUSSIAN - 17')
We didn't have them when I was young. Now we have such a large selection. We can choose our Soviet chocolates or imported ones..I prefer foreign chocolates,
especially milk.
SUPER CAPTION: Cashier

And the choice is huge.

Despite Red October's prodigious output, it cannot rival foreign brands and is facing an uphill task with the younger generation.

SOUNDBITE: (RUSSIAN -11')
I like foreign chocolates best. They're tasty, they've got nuts and different types of
chocolate cream.
SUPER CAPTION: VOX POP

In the past, the Red October factory lived off its association with the Revolution, but for today's children that has no meaning.

So it will be in the taste buds and not the minds of Russia's children that the chocolate war will be fought.


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Moskau / Russland Schokoladenfabrik roter Oktober