On Monday, the private-equity company Nomad Holdings Ltd announced that it had successfully bought Iglo Foods Holdings Ltd., Europe’s largest manufacturer of frozen food and world’s second-largest frozen food producer.
According to a report designed to brief investors of both companies, the final price of the deal was 2.6 billion euros ($2.9 billion). The acquisition was in talks since April when an agreement was finally closed between Nomad and Permira Advisers LLP. In April, Pemira agreed to retain 9 percent of the company.
According to the company’s financial documents, England-based Iglo’s sales volume was about $1.68 billion and earnings before interest, taxes, depreciation, and amortization were $343 million last year.
Iglo currently holds the second position in frozen-food industry worldwide, after McCain Foods with a 3.3 percent share of the global market in 2014. Last week, Nestle SA also announced that it would trim its portofolio by selling its European frozen-food business and brand Davigel to Bain Capital’s Brakes Group.
After the acquisition of Iglo Foods Holdings Limited, Nomad Holdings Limited was renamed to Nomad Foods Limited. The name change is consistent with the company’s long-term goal to take a deep dive into the frozen-food business.
Stefan Descheemaeker, Nomad’s newly appointed chief executive disclosed Monday a “strategic plan” meant to focus on “leveraging Iglo’s iconic brands, market positions, and attractive growth margin profile,” while promoting an organic growth.
Mr. Descheemaeker also revealed that his company was in talks to buy Findus Group, another frozen-food producer, and its European business.
Nomad hopes that Iglo and Findus would help it create a frozen-food mammoth selling a wide diversity of frozen foods from fish sticks and vegetables to microwable chili con carne and lasagna.
Iglo Foods, which owns the Birds Eye brand of frozen vegetables, reportedly sells a product line of frozen foods under Findus’ name in Italy. The information was disclosed by the NY times.
Findus has as major investors Highbridge Capital, JPMorgan Chase and Lion Capital.
But the negotiations with Findus are only “preliminary” and there isn’t much certainty that a deal would be reached, said billionaire Bill Ackman, Nomad Foods’ major investor.
On Tuesday, Ackman announced that his hedge fund management company Pershing Square bought a 21.7 percent stake in Nomad Foods. The businessman also disclosed that Iglo’s aquisition was made at a nearly 9 times 2014 adjusted earnings before interest, taxes, depreciation, and amortization, or EBITDA, which he viewed as “reasonable” related to Iglo’s “modest growth potential.”
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