Bain Capital has fought off other private equity bidders to acquire Dublin-based Valeo Foods from CapVest in a deal worth more than €1.7 billion.
Boston-based Bain, which was co-founded by former US presidential candidate Mitt Romney, won out over PAI Partners and Cinven in acquiring the owner of brands that include Jacobs biscuits and Batchelors baked beans.
"This transaction is a very positive reflection of the quality of our business and all of our people. It is also testament to the passion and commitment CapVest, our management team and all of our colleagues have shown in continuously delivering best-in-class food products to our customers and consumers across our 106 markets," said Seamus Kearney, Valeo's chief executive.
No financial details of the transaction have been publicly disclosed but Valeo was on the market for “in excess of €1.7 billion”.
Valeo was created in 2010 by Cavan financier Séamus Fitzpatrick’s London-based investment company CapVest Partners.
It was originally used as a vehicle to acquire two separate Irish businesses, Batchelors and Origin Foods. It has since expanded from an exclusively Irish food business into a global one with multiple brands and lines.
The group has been on the acquisition trail in recent years, with more than 15 deals since it was founded. Other brands it owns includes Kettle Crisps, Odlums, Kelkin and Fox’s Glacier Mints.
Higher valuation
While Valeo was on the market at over €1.7 billion, based on an earnings multiple of 10 times its current run rate of €170 million of annual earnings before interest, tax, depreciation and amortisation (ebitda), there was a view among some industry observers that it could achieve a higher valuation, especially in a competitive bidding market.
The company employs more than 4,000 employees across Ireland, Britain, Italy, the Czech Republic, the Netherlands and Germany. It recently recorded over €1.1 billion in net sales for the first time.
"Valeo Foods has been developed into a key player in the European food industry by a talented and ambitious team. We believe Valeo has further potential to grow significantly, both organically and through acquisitions, and look forward to partnering with Seamus and his team to accelerate that growth trajectory and further consolidate the company's position as a leading international food business," said Nigel Walder, managing director at Bain.
CapVest and management received financial advice from Goldman Sachs, legal advice from Willkie Farr & Gallagher, financial due diligence services from KPMG, commercial due diligence services from EY-Parthenon, and tax due diligence and structuring services from PwC.
Bain Capital Private Equity received financial advice from Credit Suisse and Houlihan Lokey, legal advice from Weil, Gotshal & Manges, financial due diligence, tax and structuring services from PwC, commercial and strategy due diligence services from OC&C, and operations and IT due diligence services from Alix Partners.
The transaction remains subject to approvals by competent regulatory authorities
