Iglo Group sale tittle-tattle false: industry source
The Mail today quoted a source “close to Birds Eye Iglo” saying that Permira had held recent meetings, where it had “pushed for the sale of Europe’s biggest frozen food supplier within the next six months” , with the firm "thought to be worth around £1.5bn".
A spokesman for Iglo Group – whose branded products under the Birds Eye name alone include fish (including its iconic fish fingers, pictured), vegetables, pies, chicken and desserts – declined to comment.
But another industry source told FoodManufacture.co.uk that they suspected no sales process was underway.
Bankers’ beauty parade
The source added that the story was weakened by The Mail’s mention that “sources close to Permira” said no decision had been taken regarding a sale, and that, in the article's words, no “beauty parade of bankers” had been appointed to advise upon such a process.
His scepticism about an imminent exit was shared by Rollits corporate finance partner, Julian Wild, who told FoodManufacture.co.uk: “Obviously, Permira buy companies to sell them at the right time, but I would say that Birds Eye [Iglo Group] has still got quite a bit of momentum.”
“So I would be surprised if they were sellers at this time. When the time comes it is most likely to be one of the big multinationals, or a company from the Far East such as Bright Food. But I’m only guessing.”
However, we understand that Permira is still building-up the necessary infrastructure to support a long-term exit.
PR Week reported in late March that Igloo Group had appointed financial and corporate communications agency Pelham Bell Pottinger with a brief based on, in the article's words, “preparing the ground for a future exit”.
Meanwhile, the company continues to perform well within a growth market, with frozen food retail sales up 2.6% to over £5.23bn in the year to June 12, 2011, according to Kantar Worldpanel.
Strong value proposition
Announcing its 2011 half-year (H1) results last Friday, Iglo Group reported 8.3% EBITDA growth to €159.9m (£139.2m), backed by NPD in the UK, Germany and Italy, and group poultry sales up 15%.
Within the UK, the company cited new products such as Catch Fresh Seafood, and “promising” early sale figures for Rice Fusions, launched in May.
The Iglo Group spokesman said: “White [private] label frozen is still struggling, but Birds Eye, Iglo, Findus (Italy) are number one or number two in nine out of the 11 markets they operate in, and provide a strong value proposition to the consumer."
Significant quality advances now meant the group’s frozen food was a “viable alternative to dining out, and you’re not trading-down in terms of quality,” he added.
But despite the fact that frozen foods accounted for the largest mean percentage of consumers’ diets in the UK compared with the rest of the EU, he said that category perceptions had traditionally been more favourable abroad.
Pointing to 5.4% net sales growth within Findus (Italy) for H1, the spokesman said that European consumers better appreciated the nutritional and freshness benefits of frozen foods.
