FDBusiness.com

Arla Foods to Use Bond Issue to Help Finance Growth Strategy

 Breaking News
  • Glanbia Cheese Joint Venture to Build New €130 Million Mozzarella Cheese Facility Glanbia Cheese, the joint venture business between Glanbia plc and Leprino Foods, plans to build a new, world-class mozzarella cheese manufacturing facility in Portlaoise, County Laois, Ireland. A site for the new facility has been identified at the recently established Togher National Industrial Estate in Portlaoise. A total of €130 million will be invested in [...]...
  • PepsiCo Reveals the 10 Finalists Joining its 2018 Nutrition Greenhouse Programme PepsiCo has announced the 10 entrepreneurs that will form the second class of its health and wellness incubator in Europe. First launched in 2017 to support the next generation of food and beverage entrepreneurs, the PepsiCo Nutrition Greenhouse programme offers each of the 10 participating companies a €20,000 grant, and access to PepsiCo mentors and experts to take [...]...
  • PureCircle Increases Capacity to Supply Reb M PureCircle, the world’s leading producer and innovator of stevia sweeteners, has announced that its recent advances in expanding capacity now enable it to supply significantly more Reb M to global beverage and food companies. Using beverage sweetening as an equivalized example, PureCircle can now supply enough Reb M to sweeten about 500 million cases of zero-calorie [...]...
  • Introducing the Propack Synchronized Staging Transfer Model PSST/120 Propack has announced a new, economical, safe product delivery system that uses stepper servo technology to receive randomly presented products from baggers, pouchers and flow wrappers to synchronise product delivery to high-speed cartoning machines. With a maximum packing rate of 120 packs per minute (PPM) to 80 twin PPM (depending on product size), the PSST/120 [...]...
  • Bel to Produce Mini Babybel at its First Canadian Factory Bel Group, a world leader in branded cheese and a major player in the healthy snack market, plans to build its first Canadian plant in Sorel-Tracy, Quebec. The facility, which is scheduled to begin commercial production in early 2020, will be fully dedicated to producing Mini Babybel® cheese. These dairy snacks encased in small and [...]...

Arla Foods to Use Bond Issue to Help Finance Growth Strategy

Arla Foods to Use Bond Issue to Help Finance Growth Strategy
June 16
12:11 2011

In order to broaden its access to finance for funding its growth strategy, Arla is giving professional investors the opportunity to invest in the company through a bond issue. The bonds will be issued in Swedish kroner and have a value of approximately SEK1.5 billion (Eur164m).

Based on a strategy of increasing the group’s turnover from the current DKr49 billion to DKr75 billion by 2015, Arla is aiming for significant growth in a number of markets. The growth will be financed through a combination of owner capital and borrowed funds.

The owner finance will be secured through the consolidation policy approved by co-operative members in the autumn of 2010 when they decided to double their investment (consolidation) in the company. The borrowed funds will come from the group’s lenders, including banks and other financial institutions.

Arla wishes to establish the broadest possible financing platform without compromising on the company’s ownership structure. As a result, Arla Foods will now issue bonds to a value of SEK 1.5 billion to supplement other financing sources.

“Arla has solid backing from its co-operative owners. Nevertheless, we also have a duty to ensure that we, as a company, have the best and broadest borrowing and financing opportunities in our pursuit of acquisitions and investments in keeping with our growth strategy,” says Frederik Lotz, chief financial officer of Arla Foods. “This is why we have decided to issue bonds as an attractive investment for institutional investors.”

The bonds will be listed in Swedish kroner on the Luxembourg Stock Exchange, with a maturity of five years and with Danske Bank and Nordea as lead managers.

”We’ve chosen to issue the bonds in Swedish kroner because Sweden, one of our core markets, is a highly effective market for corporate bonds,” Frederik Lotz adds. “The target group for the issue is primarily institutional investors in Sweden, but I won’t exclude approaching other target groups later.”

Arla’s owners have confirmed that the company will remain a co-operative and not a limited company, with external investors as co-owners. The bond issue will strengthen Arla’s strategy for growth without changing the company’s ownership structure.

About Author

colin

colin

Related Articles



Food & Drink Business Conference & Exhibition 2016

Upcoming Events

  • September 5, 2018Int'l Food Products and Processing Technologies Exhibition (WorldFood Istanbul)
  • September 15, 2018iba
  • September 25, 2018PPMA Show 2018
  • September 27, 2018Int'l Fruit Show (eurofruit)
AEC v1.0.4

find food jobs

The Magazine

F&D Business Preferred Suppliers

New Subscriber





Subscribe Here



Advertisements