In his first week in the job, Nomad Foods boss Stéfan Descheemaeker has entered talks to snap up Findus Group, and has promised that future acquisitions will not be limited to frozen.
Descheemaeker said there was room to expand to adjacent categories when opportunities arose.
“We have one starting point, and that is frozen,” Descheemaeker said. “Iglo has what it takes to be the consolidator in a very fragmented and competitive industry.
“When it comes to other categories, time will tell but we have plans to be disciplined and opportunistic.”
His comments come as the investment vehicle set up by tycoons Martin E Franklin and Noam Gottesman confirmed it was in exclusive early stage discussions to buy Findus’ Continental European business. It follows the completion of Nomad’s anchor acquisition of Birds Eye owner Iglo Group for €2.6bn.
Findus Group, which has revenues of more than £1bn and employs about 6,000 staff, is spilt into three regions: Findus Nordic, including Sweden, Norway, Finland and Denmark, Findus Southern Europe, including France, Spain and Belgium, and Young’s Seafood in the UK.
The potential deal does not include the Young’s Seafood arm of the group, which would likely be sold separately amid UK competition concerns. It is also unclear at this stage what would happen with the licence, currently held by Young’s, for Findus products sold in Britain. However, sales from this only contribute a small amount to overall turnover.
Growth has been hard to come by in the frozen sector for Iglo, with sales and profits falling at Birds Eye in 2014 and like-for-like revenues down 2.3% in the first quarter at the wider group. But Descheemaeker added there were many options available to reverse the decline, including innovation, differentiation and premiumisation.
“You have to consolidate and acquire at some stage, integrate and take the synergies and reinvest in top line,” he said. “That is what you have to do as a market leader and we have what it takes, with great brands, experienced management, long-term vision from the shareholders and a number one position, to do it.”
Findus confirmed “preliminary negotiations” on an exclusive basis were taking place on Thursday and that Nomad was currently conducting due diligence.
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