On the acquisition trail: Orkla to buy Greek ingredients supplier, takes stake in kombucha and vegetarian foods makers
01 Apr 2019 --- Orkla is on the acquisition trail with several exciting moves announced during a busy March. Orkla has entered into an agreement to purchase the majority of the shares in the Greek company Stelios Kanakis Industrial and Commercial S.A., with further moves for Asteriscos e Reticências, S.A. and Lecora.
Through its wholly-owned subsidiary Orkla Food Ingredients AS, Orkla will acquire approximately 65.8 percent from owners and founders Stelios and Maria Kanakis at a purchase price per share of €4.35. Considered a market leader in the sale and distribution of confectionery, bakery and ice cream ingredients in Greece, Kanakis is listed on the Athens stock exchange and is “well-positioned” in the region with a turnover of €20.2 million in 2018.
In March, Orkla completed an agreement to purchase 43.5 percent of the shares of the Portuguese company Asteriscos e Reticências, S.A., which produces fermented tea-based health drinks that are sold all over Europe under the Captain Kombucha brand. In the same month, the company also expanded its out-of-home sector in Sweden. Through its wholly-owned subsidiary Orkla Foods Sverige, Orkla completed an agreement to purchase Lecora, a Swedish manufacturer of frozen and chilled vegan and vegetarian dishes.
But the move for Kanakis is particularly significant within an ingredients platform expansion. “Kanakis has a leading position in our core categories, in addition to a broad-based network of customers and suppliers who are well-known to Orkla Food Ingredients. The company is well-positioned in a region that is seeing good growth,” says Johan Clarin, Orkla Executive Vice President and CEO of Orkla Food Ingredients.
The business was established in 1985 by Stelios Kanakis, who is Managing Director of the company and will continue to serve in that position. The company has 73 employees and had a turnover of €20.2 million in 2018 and EBIT of €3 million.
Orkla has also made a voluntary tender offer to all Kanakis shareholders at an proposal price of €4.36 per share. Completion of the share purchase agreement and the tender offer are subject to Orkla acquiring 4.18 percent of the shares in Kanakis from minority shareholders following the announcement of the tender offer, Orkla notes.
If Orkla attains an ownership interest of more than 90 percent in Kanakis, a squeeze-out process will be implemented and the company will be delisted. At the same time, 20 percent of the shares will be sold back to the Kanakis family at the same price as in the voluntary tender offer, with the result that the family will own 20 percent and Orkla 80 percent of the company.
The company is expected to be consolidated into Orkla’s financial statements in the second quarter of 2019.
This agreement closely follows the Norwegian branded consumer goods giant Orkla publishing its annual report for 2018, including the group’s sustainability report, which focuses on how the company creates sustainable economic growth by developing products and solutions that are good for people and the environment.
