Billion Euro sale of Kerry convenience business ‘unlikely’
The Irish manufacturer – which owns the Richmond and Walls sausage brands – has approached the Bank of America to help advise on the future of its food businesses while it focused on its Taste & Nutrition division, according to Bloomberg.
It is understood that Kerry had already been in talks to sell a 60% share of its dairy business to members of its main shareh9older, Kerry Co-op. Current share price puts Kerry worth at about €2.66bn.
‘No longer a major player’
Commenting on the sale, Rollits corporate finance director Julian Wild said: “Kerry is no longer a major player in the chilled food sector compared to companies like Greencore, Bakkavor and Samworth. It would make sense for the group to reinvest in its core ingredients business, Taste & Nutrition.
“I think the comment was that it might sell for ‘billions’ of euros. While I’m sure there will be interest in chilled meats and convenience meals, I would doubt that it would sell for anything like that figure.”
Kerry’s interim management report revealed beverages, meat and snacks within the retail channel performed well during the coronavirus pandemic, with meat in particular driven by business development in plant-based alternatives.
Covid-19 impact
Food-to-go sales were challenged by the outbreak of COVID-19 worldwide, with business volumes across the foodservice channel declining by 27%.
Commenting at the time, chief executive Edmond Scanlon said: ““In spite of the challenges arising from COVID-19, we continued to make good progress on a number of fronts aligned to our key strategic priorities.
“Our global operations and supply chain continue to demonstrate resilience and engagement with our customers has been overwhelmingly positive, which gives us confidence in the trajectory of business recovery."
Meanwhile, last month, Addo Food Group and Winterbotham Darby were acquired by private equity firm PAI Partners for undisclosed sums, with the aim of merging the two to create a significant force in chilled foods.
