Aryzta to acquire share of Picard worth over €400m

Aryzta is to acquire a 49% share in the French food business Picard worth €446.6m, it has announced.

Aryzta, who are known in Ireland for their Cuisine de France brand, says it has entered into exclusive negotiations for a strategic investment with Lion Capital in Picard and that acquiring the 49% stake will be largely funded by the recent sale of shares in the Origin Enterprises business.

Picard would be treated as an associate and expected to make a net contribution of 3% to earnings per share (EPS) on an annualised basis, offsetting 50% of the negative 6% impact of the Origin placement, it says.

Owen Killian, CEO of Aryzta said that the investment in Picard is consistent with Aryzta’s strategy of consumer relevancy through diversifying markets and channel positioning.

“Picard has delivered consistent revenue, EBITDA and market share growth over the past forty years. It offers Aryzta the future potential to acquire a highly successful business to consumer platform focused on premium speciality food, that complements Aryzta’s business to professional platform,” he said.

Aryzta says it would have the right to exercise a call option in three to five years to acquire 100% of Picard and that Picard is separately managed and separately funded with debt non recourse to Aryzta. The Swiss company would also have two seats on the Picard board.

Aryzta values Picard €2.25 billion, based on fiscal year end March 2015 run-rate revenues and adjusted run-rate EBITDA (earnings before interest, taxes, depreciation and amortization) of €1.37bn and €192m respectively.

Lyndon Lea, Partner of Lion Capital, said that in Lion is uniquely positioned to transform companies in such a way as to be viewed as attractive to strategic acquirers and that in Picard and Aryzta the company has a potent combination.

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