UK’s Birds Eye brand Iglo sold for €2.6bn

By Joyeeta Basu

- Last updated on GMT

Permira, the owner of the Birds Eye brand, will retain a 9% stake after the acquisition.
Permira, the owner of the Birds Eye brand, will retain a 9% stake after the acquisition.

Related tags Permira Iglo Group

Europe’s largest frozen foods business Iglo Group has been bought by a pair of US investors for €2.6bn, at 2.4 times return on the original investment made by parent company Permira.

The company has been sold to Nomad Holdings with the transaction expected to complete in the second quarter of 2015. Permira, the owner of the Birds Eye brand, will retain a 9% stake.

Private equity firm Permira bought Iglo from Unilever for €1.7bn in 2006. The company then acquired Findus Italy in 2010 to grow the European scale of the Iglo brand.

In 2012, Iglo was put on the market with Credit Suisse appointed to manage its sale​. Though several private equity and trade buyers had emerged as interested parties​, a final deal was not struck​. Permira had then hammered out a three year plan for Iglo with a view to reassess the situation in 2015.

Speaking about the sale, head of Permira’s global consumer team Cheryl Potter added: “Our funds will continue to support Iglo Group as minority investors and we wish the company well as it embarks on the next phase of its exciting journey with Nomad​.”

Iglo, a ‘well-run business’

The transaction is expected to be funded through a combination of Nomad’s cash on hand, equity and proceeds from a private placement of approximately $750m (€701.89m).

This is the first acquisition by entrepreneurs Martin E. Franklin and Noam Gottesman by their acquisition vehicle Nomad. The duo intends to change the company’s name to Nomad Foods Limited after the acquisition and is likely to follow up with more deals within the food industry, they said.

Calling Iglo its “anchor investment”, the company said Iglo was a combination of strong brand equity, a pipeline of new products, and a well-run business, which made it an ideal fit as Nomad’s initial investment.

We took a highly disciplined approach to evaluating opportunities for Nomad’s initial investment. During this process, it was abundantly clear that Iglo Group was a natural fit from both a strategic and a financial standpoint,” ​said Franklin, Nomad’s co-founder.

“This is a well-run business that has cemented itself as a leader in an attractive, yet highly fragmented sector, which paves the way for both organic and inorganic growth opportunities.​”

Iglo’s chief executive, Elio Leoni Sceti will leave his post in June, set to become the new chief executive of the beauty firm Coty. Nomad said a search for his replacement was underway and expected to announce a new appointment in the near future, while Sceti will become a non-executive director.

Iglo’s long history

In 1924, Clarence Birdseye, an American explorer and scientist patented the “Birdseye Plate Froster” brand after noting the benefits of quick freezing following a fishing trip. He set up a company called the General Seafoods Corporation and in the 1930s, launched the Bird’s Eye brand.

A decade later, Unilever acquired a majority of the company’s shares and expanded the brand outside of the US under the name Iglo. It also added other frozen food products such as peas and ice creams (after merging with Walls ice cream) to the brand name. Iglo now sells in 12 countries and is headquartered in the UK.

Related topics Manufacturers Prepared Foods

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