Birds Eye Iglo is the new owner of Unilever's Findus Italian frozen foods operation. (Photo: Unilever/ FIS)
Unilever finds buyer for Italian frozen foods business
Wednesday, July 21, 2010, 01:40 (GMT + 9)
Unilever plans to sell its Findus Italian frozen foods operation for EUR 805 million to Birds Eye Iglo in a continued effort to build on international brands.
In 2006, Findus Italy was the only part of the European frozen food operations Unilever retained when selling Birds Eye and Iglo to private equity firm Permira for EUR 1.73 billion. Findus Italy had revenue of EUR 462 million in 2009.
Birds Eye Iglo has a “significant stake” in the buyer of Findus Italy, according to Unilever, the second-biggest consumer goods maker in the world.
Included in the new deal are leading brands 4 Salti in Padella, Sofficini, Capitan Findus and That's Amore, as well as a dedicated factory in Cisterna, Italy.
"Findus is the lynchpin of an attractive and profitable frozen foods business and I am confident that it will prosper under the dedicated resource and focused management that the new owners will bring,” stated Unilever Italy chairman James Hill. "With this deal Unilever is now in a stronger position to focus on its core categories outside frozen foods and to achieve long-term growth in the Italian market."
Permira used around EUR 500 million worth of leveraged loans to fund the acquisition, two people familiar with the deal said, Bloomberg reports.
“The proceeds are a little bit better than anticipated,” said Gerard Rijk, an analyst at ING in Amsterdam.
He said he had anticipated a deal of EUR 490 million to EUR 630 million.
“This is a divestment of a low-growth area, so the company is continuing on its strategy and is executing quite well,” Rijk added.
Per the deal, some 650 factory and head office employees will transfer to Birds Eye. The agreement is subject to European Union (EU) anti-trust regulatory approval.
Unilever is at this time “in a stronger position to focus on its core categories outside frozen foods and to achieve long-term growth in the Italian market,” said James Hill, chairman of the London- and Rotterdam-based company’s Italian unit.
The company first announced it wanted to sell Findus Italy back in April, when it hired Goldman Sachs Group Inc to sell the business.
Birds Eye Iglo beat out some heavy competition to land the deal with Findus Group, which is owned by private equity firm Lion Capital.
Unilever's Italian ice cream business -- including the Viennetta, Solero and Cornetto brands -- is not involved in the deal.
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By Natalia Real