MEXICO CITY — Grupo Bimbo S.A.B. de C.V. on July 9 said it has reached a definitive agreement to acquire Panrico S.A.U., excluding the packaged bread business of Panrico.
The announcement follows by a little more than two weeks Bimbo’s brief statement that it had reached a preliminary agreement to acquire the Barcelona-based baking company.
Announcing the definitive agreement, Bimbo said it will pay a cash price of €190 million ($209 million).
“With annual sales of approximately €280 million ($308 million) in 2014, Panrico is one of the leading producers in the baking industry in Spain and Portugal, and participates in the sweet baked goods and buns and rolls categories, along with the packaged bread category excluded from this transaction,” Bimbo said. “The acquisition includes well-positioned brands such as Donuts, Qé!, Bollycao, La Bella Easo and Donettes, among others.”
The sales figure of $308 million refers to the portion of the business Bimbo will be acquiring, a spokesperson for the company said. Panrico has more than 2,000 employees and operates nine production facilities, Bimbo said.
“This transaction will further strengthen Grupo Bimbo’s profile in the region, through the capture of synergies, complementing its current product portfolio, distribution network and manufacturing facilities,” the company said.
Bimbo said the transaction remains conditional upon regulatory approvals and is expected to close during the fourth quarter of 2015.
Financial advisers in the transaction include Bank of America Merrill Lynch, J&A Garrigues, PwC, and Freshfields Bruckhaus Deringer.
Founded in 1962, from 1973 until 1999, Panrico was 50% owned by Allied Domecq Group. In recent years, Panrico has grown with a number of acquisitions, including the Artiach biscuit business in 2008 (acquired from Kraft Foods) and La Bella Easo in 2010, a maker of cupcakes, milk bread and croissants.
The transaction would represent an expansion of Bimbo’s presence in Iberia. In 2011, the company acquired Sara Lee Corp.’s fresh bakery business in Spain and Portugal for €115 million. The transaction included bread, pastries and snacks produced under the Bimbo, Silueta, Ortíz, Martinez and Eagle brands, among others. Bimbo in Iberia at the time had more than 1,900 employees, seven production facilities and more than 800 distribution routes.In 2013, the last year in which Grupo Bimbo released financial results for its Iberian business alone, the region had annual sales of 5,323 million pesos, equating to 3% of the company’s total. Since then the Iberian business is grouped with Bimbo operations in the United Kingdom to make up the European segment.