Bird's Eye brands up for sale; private equity divestures look set to continue

By Jane Byrne

- Last updated on GMT

Related tags: Private equity, Kohlberg kravis roberts, Uk

Is private equity likely buyer for Bird's Eye brand?
Is private equity likely buyer for Bird's Eye brand?
Frozen food business - Iglo - is up for sale as the private equity group behind it - Permira - is getting out after five years of ownership; the asking price is set to be in the region of €3bn.

A source close to the deal told that Credit Suisse has been appointed to manage the sale but as of yet there is “no timetable in place.”

She said the "time was right for the investors to exit after several years of growing the brands."

Permira bought the business which includes the Birds Eye fish fingers and frozen peas brands, from Unilever for €1.7bn in 2006.

The private equity firm expanded the Iglo operations in 2010 with the acquisition of Findus Italy, again from Unilever for €800m. The rest of the Findus business is based in UK and is owned by Lion Capital.

Iglo has manufacturing facilities in Remerhaven and Reken in Germany, Lowestoft in the UK and Cisterna in Italy.

The source said that its EBITA for the full year 2011 is set to be in the region of €320m.

Private equity investment shake-up

There are a number of other investor groups that are touting food industry assets currently.

United Biscuit owners Blackstone Group LP and PAI Partners are also reported to have lined-up Credit Suisse to sell its salty snacks business for £500m, according to media reports.

Meanwhile, US private-equity firm Oaktree Capital Management is reportedly aiming to divest itself of private-label ice cream maker R&R Ice Cream.

A lot of companies still have the “battening down the hatches”​ mentality but many food businesses are doing well and are sitting on a lot of cash, said Julian Wild, food group director at law firm Rollits.

Frustrated at the lack of opportunity for organic growth, he told previously that he expects companies to look to expansion through acquisition this year.

“Many private equity firms will want to dispose of food businesses that didn’t deliver,”​ said Wild back in December 2011. He cited a number of deals then that did not work out for investors such as the purchase of UK biscuit maker Burton’s Foods by private equity group, Duke Street Capital.

Meanwhile, UK investor group, Lion Capital, has scrapped plans to flog the Nordic part of frozen food business Findus, which is laden down with debts, with the Financial Times reporting that the private equity firm is to invest £100m in the group instead in a bid to reset the covenants.

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1 comment

Birds Eye Igo possible sale

Posted by Alan Jolly,

A small point,a spelling mistake
The Iglo plant is in Bremerhaven, and a very efficiently run operation.

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