IAWS agrees to take over Hiestand, forming Aryzta
IAWS Group Plc, the Irish maker of Delice de France baked goods, agreed to buy A. Hiestand Holding AG to create a company with combined sales of 2.3 billion euros ($3.6 billion).
IAWS, which already has a 32 percent stake in Hiestand, will own 83.3 percent of the new baker, Aryzta, the companies said today in a statement. Lupfig, Switzerland-based Hiestand will have an 8.7 percent holding. IAWS, located in Dublin, will buy Lion Capital LLP's 32 percent Hiestand stake for cash and shares.
The purchase brings IAWS a company making and selling bread, croissants and pastries in countries from Germany to Japan, complementing the Irish baker's North American, U.K. and French units. It also continues the expansion of IAWS' consumer-foods division after the purchase of U.S. cookie maker Otis Spunkmeyer and the transfer of its agribusiness units into a new company.
``We've preserved all of our cash firepower going forward for cash acquisitions,'' Owen Killian, IAWS' chief executive officer, said in a telephone interview. ``Synergies will come from exploiting the brand opportunities, the manufacturing technology.''
Hiestand fell 28 Swiss francs, or 1.4 percent, to 1,975 francs at 9:10 a.m in Zurich trading. IAWS gained 82 cents, or 5.1 percent, to 17 euros in Dublin.
The combined company will have a market value of about 4.4 billion francs ($4.3 billion), Hiestand executives said on a conference call with journalists. Aryzta aims to double profit in five years, according to Killian, who will head the company.
The Irish baker will offer to buy all outstanding Hiestand shares after purchasing Lion Capital's stake. The proposal is required under Swiss takeover rules and will be on the same terms as the merger, the company said.
Owners of the Irish company's stock will receive one Aryzta share for every two IAWS shares held. Hiestand investors will get 36 Aryzta shares for each share held.
Davy Corporate Finance, Credit Suisse and BNP Paribas are advising IAWS. Swiss Capital Group and Bank Sarasin & Cie. are Hiestand's advisers. (Bloomberg)