` UK-Based Fund Set to Take Control of Deoleo - Olive Oil Times

UK-Based Fund Set to Take Control of Deoleo

Apr. 11, 2014
Julie Butler

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The board of debt sad­dled olive oil giant Deoleo has anointed a finan­cial restruc­ture offer from CVC Capital Partners which could see the pri­vate equity firm take over the Madrid-based com­pany.

The global fund, which has its main office in London, focuses on man­age­ment buy­outs and its diverse port­fo­lio includes fast food oper­a­tors in China and Malaysia and a fast food and casual din­ing restau­rant chain in Spain. Its €0.38 a share offer – four cents below Thursday’s clos­ing mar­ket price – val­ues Deoleo at €439 mil­lion.

Deoleo is hun­gry for invest­ment because it has about €506 mil­lion in debt and needs cap­i­tal to grow via what it sees as a promis­ing new range of prod­ucts. Meanwhile, var­i­ous banks among its share­hold­ers want to divest.

According to infor­ma­tion pub­lished by Deoleo CEO Jaime Carbó on Thursday evening, the company’s board has green­lighted CVC Capital Partners’ pro­posal to first take an ini­tial 29.99% stake in Deoleo fol­lowed by a bid for full own­er­ship. The deal would also see the fund refi­nance Deoleo’s debt and its exe­cu­tion will depend on final agree­ment being reached by affected par­ties and rat­i­fi­ca­tion by Deoleo’s board.

The ques­tion over who will end up con­trol­ling the Spanish” com­pany has gen­er­ated wide­spread media cov­er­age in Spain in recent weeks, with con­cerns it would be sold to for­eign inter­ests and its port­fo­lio of key brands includ­ing world lead­ers Bertolli, Carbonell and Carapelli split up. The issue became even more polit­i­cal when a joint ven­ture involv­ing an Italian state invest­ment fund was known to be among the bid­ders.

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Dcoop – the for­mer Hojiblanca Cooperative Group and the world’s biggest pro­ducer of extra vir­gin olive oil – issued a state­ment lament­ing that Deoleo prefers a for­eign invest­ment fund” to its own bid, which was based around the Spanish indus­try.”

Spanish con­cerns about the impli­ca­tions of for­eign own­er­ship of Deoleo for the country’s olive oil sec­tor – expected to pro­duce about half of total world pro­duc­tion this sea­son – come despite Deoleo itself stress­ing last November that it wants to posi­tion olive oil as a fast mov­ing con­sumer good and to buy and pack­age its oil in any part of the world it chooses.


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