Nomad Foods has made further strides toward its ambition of creating a global food group with the £500m acquisition of the European arm of Findus.

It creates a frozen foods giant following Nomad’s €2.6bn (£1.84bn) anchor investment in April to purchase Birds Eye owner Iglo Group.

Nomad has agreed to purchase Findus Group’s continental European businesses in Sweden, Norway, Finland, Denmark, France, Spain and Belgium from a group of investors, including Highbridge Capital, Lion Capital and Sankaty Advisors. The deal includes the Findus, Lutosa, and La Cocinera brands in these markets.

It also reunites the Findus operations in Italy, which are owned by Iglo, to create a pan-European frozen food business.

The remaining part of the Findus Group, including Young’s Seafood in the UK, will remain under the ownership of Lion, Highbridge and other investors.

“This transaction is in line with our growth strategy, an exciting addition to the Nomad portfolio, and a significant milestone in reaching our goal of building a global consumer foods company,” Nomad CEO Stéfan Descheemaeker said.

“While the operations we are acquiring are strong, attractive assets on their own, combining them with our existing businesses creates a unique value proposition and unlocks new growth opportunities.”

The operations being acquired include approximately 1,500 employees and six manufacturing facilities in Norway, Sweden, France, and Spain, as well as the intellectual property and commercialisation rights in the relevant territories.

Revenues of the assets stand at about €600m and Nomad expects to find €25m to €30m of annual cost saving over the next three years.

Nomad, an acquisition vehicle founded by US tycoons Martin E. Franklin and Noam Gottesman, was floated on the London Stock Exchange in April 2014, raising $500m (£327.2m) on the back of its ambitious plans. It raised another $795m (£493m) from a private placement to institutional investors to fund the Iglo acquisition, with intentions to raise about $750m more for future deals.

Gottesman and Franklin added in a joint statement: “Curating a portfolio of market-leading consumer foods companies remains our core objective and this acquisition furthers our long-term commitment to growing the frozen food sector in Europe through ongoing investments in brands, innovation, and product development.

“The addition of these businesses is transformative to Nomad as it augments our product offering, customer reach, and geographic footprint, further solidifying our leadership position in Europe’s fragmented frozen foods sector.”

Findus Group CEO James Hill said: “This transaction represents a strategic milestone for Findus and is a positive development for the European food industry as a whole. The new group will be bigger, stronger, more efficient and more innovative than its component parts, offering significant benefits not only to consumers, but to all of our stakeholders.”

UBS Investment Bank and Credit Suisse acted as financial advisers and Greenberg Traurig provided legal advice to Nomad on the transaction.

Nomad will use existing cash to fund the £400m cash portion of the deal, as well as seeking further debt funding from UBS, Credit Suisse and Barclays. It will also issue 8.4 million shares to Lion, Highbridge and the other vendors in the selling group.

Centerview Partners acted as exclusive financial adviser and Latham & Watkins acted as legal adviser to the seller.

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