Orkla Agrees to Acquire Rieber & Søn ASA

Rieber & Søn is listed on the Oslo Stock Exchange, and is an important supplier to grocery stores in the Nordic countries, parts of Central Europe and Russia. Its well-known brands include Toro, Vitana, K-Salat, Delecta, Frödinge, Chaka and Bähncke. In 2011, its total sales amounted to about NOK 4.3 billion.

21 Aug 2012 --- Norwegian consumer goods and industrial conglomerate Orkla ASA has signed an agreement with the Rieber family to buy their shares in Norwegian food company Rieber & Son ASA (RIE.OS), in a deal that values the company at 6.1 billion Norwegian kroner ($1.03 billion).

The agreement encompasses 90.11 per cent of the shares in Rieber & Søn at a price of NOK 66.58 per share. The transaction values the entire company (on a debt-free basis) at NOK 6.1 billion.

Rieber & Søn is listed on the Oslo Stock Exchange, and is an important supplier to grocery stores in the Nordic countries, parts of Central Europe and Russia. Its well-known brands include Toro, Vitana, K-Salat, Delecta, Frödinge, Chaka and Bähncke. In 2011, its total sales amounted to about NOK 4.3 billion. Operating profit before depreciation and amortisation (EBITDA) came to NOK 642 million in 2010 and NOK 464 million in 2011. The company has a total of 2900 employees, of whom 1700 work outside of Norway.

"Rieber & Søn is a well-run group, with a strong heritage, talented employees and strong market positions. Together, Rieber & Søn and Orkla will be the leading Nordic food manufacturer, with the expertise and resources to develop strong local products and brands in competition with international players," comments CEO Åge Korsvold of Orkla.

"The Rieber family has owned the company since it was founded in 1839. We are proud of what we have developed through generations together with our employees. We have considered different strategic options and potential buyers, and we are confident that having Orkla as owner is the best alternative for further developing our companies and brands," says Fritz Rieber on behalf of the Rieber family.

Rieber & Søn has a range of familiar brands and businesses: Toro is Norway's leading supplier of sauces, soups and ready-made meals, and other products. Other famous Norwegian brands in Rieber & Søn’s portfolio include Denja, Mr. Lee, Vossafår and Vestlandslefsa. Vitana is one of the Czech Republic's largest and most renowned food manufacturers. K-Salat has a good position in both Sweden and Denmark in mayonnaise, remoulade and salads. Delecta is one of Poland's leading dessert and bake mix brands. Frödinge is the market leader in chilled and frozen cakes and desserts in Sweden. Chaka is a well-known Russian brand of nuts. Bähncke is the leading Danish mustard brand. In addition, Rieber & Søn supplies the food service sector in Norway, Sweden, Denmark, the Czech Republic and Slovakia.

"With this acquisition, Orkla expands its product portfolio and gains strong market positions in categories that are entirely new to us. Rieber & Søn has created local food customs and defined the well-loved taste of a number of familiar products. The company has strong brands that are an optimal fit for Orkla's product portfolio as regards categories, production technology and geography," Korsvold elaborates.

Orkla has signed the agreement with the companies AS Atlantis Vest, Zee Ploeg AS and Flu AS. The selling companies are owned and controlled by representatives of the Rieber family. The purchase price will be paid as a cash settlement, funded by drawing on committed credit facilities. The purchase price will be adjusted based on an interest rate corresponding to NIBOR3M for the period from the signing of the agreement until closing.

Closing of the transaction is conditional upon receiving approval from the European Commission and Russian competition authorities. It is expected that closing of the transaction can take place by the end of Q1 2013. After completing the transaction with the Rieber family, Orkla will present a mandatory offer to the remaining shareholders in the company based on same price per share that will be paid to the Rieber family, and subsequently seek to have the company delisted from the Oslo Stock Exchange.

More detailed information about Rieber & Søn, including facts about its governance and management as well as key figures, is included in appendix. More detailed information about the transaction and its importance for Orkla is also included in appendix.