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Flavours firm Wild to go on sale for 1.5 bln euros

Zoom in font  Zoom out font Published: 2014-03-11  Views: 24
Core Tip: German drink and food flavours maker Wild is putting itself up for sale in a deal that could value the company at 1.5 billion euros ($2.1 billion), three people familiar with the matter said on Monday.
German drink and food flavours maker Wild is putting itself up for sale in a deal that could value the company at 1.5 billion euros ($2.1 billion), three people familiar with the matter said on Monday.

Citigroup Inc, which is organising the transaction, will send out information packages to a small group of pre-selected bidders later this month, the people said, adding first bids are expected to be due by the end of April.

Simultaneously, a potential stock market listing is being prepared, the sources said.

Hans-Peter Wild, son of founder Rudolf Wild, owns 65 percent of Wild Flavors, while buyout group KKR owns 35 percent. Wild is also the owner of a separate company which makes the Capri-Sun drink.

Potential buyers are likely to value the company at between 1.4 billion euros and 1.7 billion, or 10 to 12 times Wild Flavor's expected 2014 core earnings (EBITDA) of 140 million euros, the sources said.

That would be in line with the valuation of competitors which trade at about 11 times expected operating earnings, according to Thomson Reuters data.

Peers such as Givaudan, Symrise, IFF , Sensient Flavors, Ingredion and Ajinomoto are likely to show interest in Wild, although some may face antitrust issues as Wild is the world's sixth-biggest flavour provider.

Separately, private equity groups such as Advent, EQT, Cinven, BC Partners, CD&R and Permira are also likely to be invited to the auction, the sources said.

"One possible outcome, which should not be ruled out, is that the auction is mainly a price-finding exercise and may result in KKR buying out Wild or vice versa," one banker working on the transaction said.

Bankers have also started preparing debt packages of about 1 billion euros, or 7.5 times Wild's operating earnings, another source said.

Any buyer of Wild will get access to a large variety of flavours, extracts, seasonings and colours derived from natural sources, which are crucial components of processed foods and beverages. Customers have of late been showing increasing appetite for foods comprising only natural components.

Wild, headquartered in Zug, Switzerland, was founded in 1931 in Heidelberg, Germany, as a producer of ingredients for non-alcoholic beverages. About 20 years later it started selling Libella, Germany's first carbonated juice drink based on natural ingredients only.

Wild Flavors posted 2013 sales of almost 900 million euros.

Since KKR's investment in Wild, the flavour maker has bought several companies, including Cargill's juice blends business, mint oil maker A.M. Todd and natural extracts maker Alfrebro.

KKR, Givaudan, Symrise, Ajinomoto, BC Partners, EQT, Advent and CD&R declined to comment, while Wild, IFF, Sensient Flavors, Ingredion and Cinven were not immediately available for comment.

 
 
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