May 25, 2012
Parmalat to acquire Lactalis American Group Inc.
Press release
Parmalat S.p.A. announces the acquisition of Lactalis American Group Inc., which includes the distribution, on an exclusive basis, of the products of the Lactalis Group throughout the Americas.
This transaction will offer opportunities for Parmalat by providing entry into the US dairy market, which is one of the largest in the world. It will also put Parmalat in a stronger competitive position in Latin America with access to high growth markets, such as Brazil and Mexico, the addition to its current activities in Colombia and Venezuela.
Revenue is also projected to increase provided by value-added products, such as cheese; and the export of cheddar cheese "Black Diamond" brand from Canada to the US, with relevant important synergies in costs and revenues. Lactalis American Group Inc. is active in "soft and fresh" cheese, currently virtually absent from Parmalat''s portfolio.
Lactalis American Group Inc. operates mainly in the US in the production and distribution of cheese and other dairy products. Its portfolio of proprietary and licensed brands includes international brands, such as "Galbani" and "Pr？？sident," and local brands, such as "Sorrento," "Precious" and "Mozzarella Fresca."
In 2011, Lactalis American Group Inc. reported revenues of US$979.3 million and EBITDA of US$84 million; its net financial assets amounted to $19.4 million as at December 31, 2012.
The acquisition computed on the basis of the enterprise value amounting to US$904 million (9.5 times EBITDA forecast for 2012) which will be adjusted to take into account the cash availability at the date of the end of the month closer to the closing and a price adjustment mechanism based on the EBITDA actually earned. The transaction will be totally financed by its own means and it will be completed within July 2012.