Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


PEP sells Griffin's to Universal Robina for $700M

PEP sells Griffin's to Universal Robina for $700M after capital return, refinancing in 2013

By Paul McBeth

July 21 (BusinessDesk) - Pacific Equity Partners has sold Griffin's Foods to Universal Robina Corp for $700 million after the Australian private equity firm pulled out capital from its investment and saddled the New Zealand biscuit maker with debt last year.

The sale comes after accounts for NZ Snack Food Holdings show the Griffin's holding company made a capital return of $192 million in a share repurchase in the same year PEP refinanced the maker of Gingernuts, Mellow Puffs and Huntley & Palmers crackers and Eta brand snacks.

The group had interest bearing debt of $442.4 million as at Dec. 31, up from $234.6 million a year earlier, according to financial statements lodged with the Companies Office. The $274.5 million of bank debt matures in January 2016, while $167.9 million of mezzanine notes mature in January 2019.

NZ Snack Foods reported a 75 percent slump in profit to $5.1 million in calendar 2013, as its finance costs climbed by more than half to $23.8 million. Revenue fell 4.3 percent to $280.8 million. Gross margins were largely unchanged at 53 percent. Operational cash inflow more than doubled to $34 million, and the group held cash of $34.8 million as at Dec. 31.

The deal is subject to Overseas Investment Office approval, and ends PEP's eight-year ownership of the snack foods maker. Chief operating officer Alison Taylor will take over as chief executive once the sale if completed.

"We believe Griffin's is a natural strategic fit to our existing snack foods portfolio given its strong brand heritage in New Zealand - a country trusted worldwide in having high credibility when it comes to food quality, safety and authenticity," URC chief executive Lance Gokongwei said in a statement.

URC is a Philippines-based food and beverage company

PEP tried to sell Griffin's in 2011 after struggling to find a buyer. It was reportedly looking for a price in the range of seven to nine times earnings, which were about $108 million at the time.

The Australian private equity firm bought Griffin's for $292.4 million in 2006 from French food group Danone at an enterprise value of $385 million, and later acquired the Nice & Natural wrapped snacks business for $55 million.

PEP invested $180 million into Griffin's operations, creating two manufacturing centres in Auckland and buying the Nice & Natural business, it said.

Credit Suisse and First NZ Captial were exclusive M&A advisers to Griffin's.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Economic Update: RBNZ Says Rate Cut Seems Likely

The Reserve Bank will likely cut interest rates further as a persistently strong kiwi dollar makes it difficult for the bank to meet its inflation target, it said. The local currency fell. More>>

ALSO:

House Price Action Plan: RBNZ Signals National Lending Restrictions

The central bank wants to cap bank lending to property investors with a deposit of less than 40 percent at 5 percent and restore the 10 percent limit for owner-occupiers wanting to take out a mortgage with a deposit of less than 20 percent, according to a consultation paper released today. More>>

ALSO:

Sparks Fly: Gordon Campbell On China Steel Dumping Allegations

No doubt, officials on the China desk at MFAT have prided themselves on fashioning a niche position for New Zealand right in between the US and China – and leveraging off both of them! Well, as the Aussies would say, of MFAT: tell ‘em they’re dreaming. More>>

ALSO:

Loan Sharks: Finance Companies Found Guilty Of Breaching Fair Trading Act

Finance companies Budget Loans and Evolution Finance, run by former 1980s corporate high-flyer Allan Hawkins, have been found guilty of 106 charges of breaching the Fair Trading Act for misleading 21 borrowers while enforcing loan contracts. More>>

ALSO:

Post Panama Papers: Govt To Adopt Shewan's Foreign Trust Recommendations

The government will adopt all of the recommendations from former PwC chairman John Shewan to increase disclosure and introduce a register for foreign trusts with new legislation to be introduced next month. More>>

ALSO:

The Price Of Cheese: Cheddar At Eight-Year Low

Food prices decreased 0.5 percent in the year to June 2016, influenced by lower grocery food prices (down 2.3 percent), Statistics New Zealand said today. Compared with June 2015, cheese prices were down 9.5 percent, fresh milk was down 3.9 percent, and yoghurt was down 9.2 percent. More>>

ALSO:

Financial Advisers: New 'Customer-First' Obligations

Goldsmith plans to do away with the current adviser designations which he says have been "unsatisfactory" in that some advisers are obliged to disclose potential conflicts of interest and act in their customers' best interests, but others are not. More>>

ALSO:

Get More From Scoop

 
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news