Upfield
KKR Preps Upfield (Flora Foods) Exit With Citi and Goldman Sachs Advising; Company Marketed off €800M-€900M EBITDA
Tue 01/16/2024 13:38 PM
KKR is preparing to exit Upfield, also known as Flora Foods, a Dutch food company owning multiple brands of margarine, food spreads and plant-based foods, including Flora and Blue Band. The sponsor has hired Citi and Goldman Sachs to advise on the process, sources told Reorg.
The plant-based spreads producer is expected to be marketed off EBITDA between €800 million and €900 million, depending on adjustments, sources said.
The exit is being handled as an unstructured process, with sell-side advisors holding fireside chats with potential buyers, two of the sources said.
Flora Foods, whose holding company Sigma rebranded as Upfield in 2018, was acquired by KKR from Unilever for €6.825 billion in 2017, making it the largest leveraged buyout of that year.
Upfield’s summary of key financials is below:
The company’s reported leverage ratio was at 6.9x as of Sept. 30, 2023, compared with 7.2x at Dec. 31, 2022.
In July, the company extended the maturity of €1.872 billion, $797 million and £468 million of its term loan B tranches in each currency to January 2028 from July 2025, as reported. As a result, the non-extended stubs are €527 million, $40 million and £164 million.
Reorg’s primary preview of Upfield is HERE.
Upfield could be worth about 12x EBITDA, which implies a reasonable equity cushion considering its net leverage, one source previously estimated, as reported. This compares with an EV/EBITDA ratio of 16.5x for Nestle, which is a much stronger business, and 10.3x and 12.5x for Danone and Unilever, respectively, he said.
KKR declined to comment. Citi and Goldman Sachs did not respond to a request for comment.
The plant-based spreads producer is expected to be marketed off EBITDA between €800 million and €900 million, depending on adjustments, sources said.
The exit is being handled as an unstructured process, with sell-side advisors holding fireside chats with potential buyers, two of the sources said.
Flora Foods, whose holding company Sigma rebranded as Upfield in 2018, was acquired by KKR from Unilever for €6.825 billion in 2017, making it the largest leveraged buyout of that year.
Upfield’s summary of key financials is below:
In July, the company extended the maturity of €1.872 billion, $797 million and £468 million of its term loan B tranches in each currency to January 2028 from July 2025, as reported. As a result, the non-extended stubs are €527 million, $40 million and £164 million.
Reorg’s primary preview of Upfield is HERE.
Upfield could be worth about 12x EBITDA, which implies a reasonable equity cushion considering its net leverage, one source previously estimated, as reported. This compares with an EV/EBITDA ratio of 16.5x for Nestle, which is a much stronger business, and 10.3x and 12.5x for Danone and Unilever, respectively, he said.
KKR declined to comment. Citi and Goldman Sachs did not respond to a request for comment.
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