Nestle reviewing possible sale of frozen food unit Davigel: sources
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[February 04, 2014]
By Sophie Sassard and Anjuli Davies
LONDON (Reuters) — Nestle <NESN.VX> is
exploring a possible sale of frozen foods business Davigel for about
300 million euros ($400 million), three sources familiar with the
matter told Reuters on Monday, as part of a drive to trim its
The world's largest food company, which said on Monday it sold its
PowerBar business, is close to appointing a bank to advise on the
possible sale, the sources said.
Nestle declined to comment.
Potential buyers were likely to include food service providers such
as Brake Brothers, Booker Group and Sodexho <EXHO.PA> as well as
private equity firms, the sources said. Bain & Co and Clayton,
Dubilier & Rice are obvious choices, one said, since both have
invested in food service in the past.
Davigel's 2012 earnings before interest, taxes, depreciation and
amortization were between 30 million and 35 million euros and the
business could sell for a mid- to high-single-digit multiple of
that, two bankers said.
Davigel — which supplies frozen and chilled meals and ice cream to
restaurants and hospitals — was part of the Buitoni frozen food
business Nestle bought in 1989.
Nestle has not yet officially mandated a bank to sell Davigel but
has worked closely with Credit Suisse <CSGN.VX> in the past and is
expected to appoint that bank for this deal.
Credit Suisse declined to comment.
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Nestle — whose wide range of products includes Gerber baby food and
Perrier bottled water — said in October it would divest
It announced the sale of PowerBar and Musashi to Post Holdings <POST.N>
on Monday, the sale of its U.S. frozen pasta business to Brynwood
Partners in January and the bulk of its Jennie Craig business in
Nestle sold a 10 percent stake in fragrance and flavor maker
Givaudan <GIVN.VX> in December.
(Additional reporting Martinne Geller in
London and Silke Koltrowitz in Zurich; editing by Louise Ireland)
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