Europe's MWBrands all set for sale

The sale of the European canned seafood producer MWBrands is expected to be finalised by end of month, according to industry sources.

 

The Paris-based producer, whose brands include John West and Mareblu, is currently held by Trilantic Partners, formerly the private equity arm of the failed investment bank Lehman Brothers.

 

Thai Union Frozen Products Plc (TUF) and Italy's Bolton Group are among the companies that have expressed interest in bidding for MWBrands as a strategic partner.

 

 

Trilantic Partners, which purchased MWBrands from HJ Jeinz for 425 million in 2006, has retained UBS as a financial adviser for the sale. The valuation range for MWBrands has been announced at 650-700 million.

 

A source said MWBrands expected at least 10% annual sales growth over the next three years, and offered strong long-term prospects within the consumer foods sector.

 

Once the bid is complete, the winner will then be allowed to conduct a new due dilligence into MWBrands' operations and accounts before negotiating final sales and payment terms.

 

TUF president Thiraphong Chansiri in March said the company expected record earnings this year, driven by recovering demand and widening margins, particularly in the US market. TUF owns the Chicken of the Sea brand.TUF reported first-quarter profits of 831.22 million baht (US$25.67 million) on revenues of 16.74 billion baht (US$517,065.64). It posted 2009 profits of 3.34 billion baht (US$103.17 million) on revenues of 69.7 billion (US$2.15 million).

 

A successful bid for MWBrands would likely help lift margins further. MWBrands last year had EBITDA margins as high as 16.9%, compared with 8.6% for TUF.

 

"But it remains far from certain who the winner of the sale will be, as interest has been expressed from a number of global players," said a source familiar with the deal.