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Aryzta Makes Strategic Acquisitions Worth $1.08b

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Aryzta Makes Strategic Acquisitions Worth $1.08b

Aryzta Makes Strategic Acquisitions Worth $1.08b
June 14
09:58 2010

Switzerland-based speciality bakery group Aryzta has made two strategic acquisitions to significantly strengthen its position in Europe, North America and in other international markets. Aryzta has acquired Fresh Start Bakeries (incorporating Pennant Food and Sweet Life) and Great Kitchens for $900m and $180m respectively.

Operating 29 specialist production facilities across the US, Canada, Germany, Poland, Sweden, Spain, Brazil, Australia and New Zealand along with joint ventures located in North America, Chile and Guatemala, .Fresh Start Bakeries is a global supplier of speciality bakery products with a leading position in the Quick Service Restaurant (QSR) segment. Pennant Foods is a leading provider of speciality bakery products and solutions to the North American QSR, food service and retail in-store-bakery channels. Sweet Life is a leading innovator and manufacturer of sweet baked goods servicing the North American and Asian QSR channel.

Great Kitchens is a leading supplier of pizza and appetisers with a focus on the deli segment of the North American retail grocery channel. The combined revenue of the businesses being acquired is $1.03b, with associated EBITDA of $133m.

The acquisitions double Aryzta’s manufactured volumes and permit greater access to a broader customer base within the expanding QSR and retail segments. Moreover, they also provide Aryzta with a more balanced exposure to its core markets of North America and Europe, while extending its geographical footprint in rapidly expanding developing markets. Indeed, Aryzta is renaming its ‘food developing markets’ segment as ‘rest of the world’. This reporting segment will include territories across South America, Asia, Australia and New Zealand.

Meanwhile, greater diversification in terms of customer mix enhances the defensive characteristics of the Aryzta’s business model. “From a business perspective we will operate with a greater geographic footprint and with much better channel access to consumers. These acquisitions double our manufactured volumes with an additional 30 production locations in nine countries,” says Owen Killian, chief executive of Aryzta.

Following the transactions it is anticipated that Aryzta’s net debt/EBITDA ratio will be in the region of 3 times for the year ending 31st July 2010.

Created in 2008 by the merger of Dublin-based IAWS Group and Hiestand Holding of Switzerland, Aryzta has a primary listing on the SIX Swiss Stock Exchange and a secondary listing on the Irish Stock Exchange.In Europe Aryzta has a mixture of business to business and consumer brands, including Hiestand, Cuisine de France, Delice de France and Coup de Pates.

CAPTION:

Owen Killian, chief executive of Aryzta.

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