Frozen food giant to be acquired for $2.8 billion

by Monica Watrous
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Findus brand macaroni & cheese, cottage pie and crispy pancakes
Iglo Group manufactures and markets premium frozen foods under the Birds Eye and Findus brands.

TORTOLA, BVI — Nomad Holdings Ltd., has entered into a definitive agreement to acquire Iglo Foods Holdings Ltd., Europe’s leading frozen food company, for approximately €2.6 billion ($2.8 billion) from a company funded by Permira, a private equity firm.

Iglo Group manufactures and markets premium branded frozen food products, including fish, vegetables, meat and meals, in 12 countries across Europe with a focus on markets in the United Kingdom, Germany and Italy. Core brands, including Birds Eye in the United Kingdom and Ireland, Iglo in Germany, Austria, The Netherlands and other European markets, and Findus in Italy. Headquartered in the U.K. with approximately 2,800 employees, Iglo Group had full-year net sales of €1.5 billion ($1.6 billion) and adjusted EBITDA of €306 million ($328.8 million) in 2014.

Upon closing of the transaction, Nomad plans to change its name to Nomad Foods Ltd. and intends to build a portfolio to bring together some of the world’s most iconic food companies. Nomad’s founders, Noam Gottesman, who is the founder and chief executive of investment firm Toms Capital and co-founder of GLG Partners, and Martin E. Franklin, who is the founder and executive chairman of Jarden Corp. as well as the founder and non-executive chairman of Platform Specialty Products Corp., will become non-executive chairmen of Nomad Foods Ltd. and will work closely with Iglo Group’s executive management team to execute the company’s growth strategies.

“What people eat and how and when they eat are constantly evolving, making food one of the most resilient yet dynamic categories in the consumer sector,” Gottesman said. “Iglo Group’s strong brands are clear market leaders in frozen food, and the company’s innovative and customer-centric approach will continue to drive organic growth and superior returns within the industry. The group’s scale, cash-generative profile, and experienced management team make it an ideal foundation for us to build up a world-class, global consumer foods company through a prudent M&A strategy.”

Elio Leoni Sceti, CEO of Iglo Group, has announced plans to resign from his current role in June and will become a non-executive director of Nomad Foods Ltd. upon closing of the transaction. A search is under way for his replacement.

“This is a significant stepping stone for Iglo Group as we continue to revitalize consumer interest in frozen food with meaningful innovation for every day, every meal and everybody,” Leoni Sceti said. “My time as CEO has been immensely fulfilling, and I am confident the talented team at Iglo Group will continue to drive growth as it executes on our strategy of innovation inspired by consumers. As part of Nomad, Iglo Group will benefit from Noam’s and Martin’s truly world-class leadership capabilities, which I am confident will enable the company to reach new levels of success.”

The transaction is expected to close in the second quarter and to be funded through Nomad’s cash on hand, equity and proceeds from a private placement of approximately $750 million at $10.50 per ordinary share to a limited group of institutional investors and the expected early exercise of Nomad’s existing warrants, as well as part of Iglo Group’s existing debt. The Permira funds and senior management will re-invest a portion of their proceeds into €133.5 million ($143.5 million) of equity at closing and are expected to own approximately 9 percent of Nomad Foods.

Nomad has requested that the London Stock Exchange suspends trading of its stock until after closing the transaction. Nomad also plans to pursue a primary listing of its ordinary shares on the New York Stock Exchange after the deal closes.

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