Consultancies advise food company Aryzta on sale of North America business
Aryzta, a global specialty bakery company, has sold its North American business to an affiliate of US private equity firm Lindsay Goldberg for $850 million. The Swiss-Irish company was advised on the transaction by investment banks Houlihan Lokey and Alantra, law firms Goodwin Procter and Homburger, and Big Four advisory firm KPMG.
The cash sale is expected to close by the end of July, pending regulatory approval.
Aryzta’s North American business includes artisan bread brand La Brea and cookie and muffin brand Otis Spunkmeyer. The North American division supplies bread to McDonald’s and Subway, among others, and operates 15 facilities with 4,000 employees in the US and Canada.
The transaction follows the December 2020 sale of Aryzta’s North American take-and-bake pizza business to private equity firm Brynwood Partners for an undisclosed amount. The deal included two 150,000+ square foot facilities with a 700-person workforce.
Aryzta’s troubled North America business represented 43% of its overall revenue, thought the amount it generated declined every year since 2016, according to the firm's 2020 annual report.
The overall company, which has operations in Europe, the Americas, and Asia-Pacific, has seen its shares drop more than 80% since a $956 million capital raise in late 2018. A complex business structure, $1.2 billion in net debt, and pandemic shutdowns have erased approximately 98% of the company's share value in five years.
Aryzta last year rejected a $890 million offer from US hedge fund Elliot Management Corp. to buy the entire company, instead embarking on a sell-off of non-core assets.
The firm earlier this year sold its stake in French frozen food retailer Picard. Aryzta has also placed its Latin American business on the market.
“This agreement represents a significant inflection point for Aryzta and vindication of our simplification strategy to the outright sale option,” CEO Urs Jordi said of the North American business sale. “Today’s transaction delivers significant debt reduction and balance sheet strength. It now allows us to focus on delivering further operational improvements and returning to organic growth.”
