IK refinances Solina and seals SFK Food deal

Following its acquisition of a majority stake in food ingredients business Solina, IK Investment Partners has refinanced its debt and signed, in parallel, the acquisition of SFK Food. The business is a Danish provider of culinary and functional solutions for the food industry.

PRESS RELEASE

Three years after IK Investment Partners (“IK”) acquired a majority stake, Solina (or “the Company”) has refinanced its debt and signed, in parallel, the acquisition of SFK Food, the leading Danish provider of culinary and functional solutions for the food industry.

The Solina group, one of the European leaders in the food ingredients market, has completed the refinancing of its debt with the partial reimbursement of its shareholder loans.

PRESS RELEASE

Three years after IK Investment Partners (“IK”) acquired a majority stake, Solina (or “the Company”) has refinanced its debt and signed, in parallel, the acquisition of SFK Food, the leading Danish provider of culinary and functional solutions for the food industry.

The Solina group, one of the European leaders in the food ingredients market, has completed the refinancing of its debt with the partial reimbursement of its shareholder loans.

Supported by its majority shareholder, IK Investment Partners (since July 2011), the company has delivered strong organic and acquisition-lead growth (Sfinc and Formidabel in 2011, Kerry Food Service in 2013), and has reached a turnover of more than MEUR 200 in 2013. This strong performance has enabled the company to deleverage significantly since the acquisition by IK in 2011, refinancing its debt structure supported by its current banking pool for a total amount of MEUR 166.

Commenting on today’s announcement, Dan Soudry, Partner at IK Investment Partners, said:

«The acquisition lines structured at the time of the acquisition by IK in 2011 have been fully drawn to facilitate the financing of the three acquisitions completed under IK’s ownership. The refinancing announced today will therefore benefit the company in several ways. Firstly, it will reduce the total debt service paid by the company with the partial prepayment of the senior Term Loan A. Secondly, it will help decrease the cash and PIK interest paid by the Company. Thirdly, the refinancing will enable new acquisition facilities to be structured that will support the company as it pursues its ambitious growth strategy.»

To finance this recapitalisation, Solina used MEUR 9 of cash as well as a new senior Term Loan C of MEUR 60. A new committed acquisition line of MEUR 40 was made available (and a non-committed acquisition facility of MEUR 20). All facilities were subscribed by Solina’s existing financing pool composed of CA-CIB, BNP Paribas, CA Ille-et-Vilaine, Rabobank, CIC, CIC Ouest, ING, KBC, Natixis, Banque Palatine, SG, Alcentra, Unigrains, Cerea and LFPI. The deal was co-arranged by BNP Paribas and CA-CIB.

In parallel, Solina is pleased to announce today the acquisition of SFK Food, the leading Danish provider of blends, spices, herbs and marinades. This acquisition is a major milestone towards building Solina a strong presence in the Scandinavian market. «SFK Food is renowned for its high quality recipes and its expertise in the functional and aromatic blends. This acquisition perfectly fits our international development strategy and will enable the company to generate significant cross-selling synergies leveraging its combined product portfolio offering.» said Eric Terré, Solina CEO

About Solina
Solina designs and produces ingredient-based functional and culinary solutions for the food industry. It was founded in 1988 by its current CEO Eric Terré. The company operates in three business areas: taste and visual solutions (aromatic ingredients), functional solutions and nutrition solutions (dietetic ingredients). Solina operates 9 production sites, employs 630 people and serves 9,000 clients in the food industry (ready-made meals, sauce producers, meat processors and catering firms).
For more information: www.solina-group.eu

About IK Investment Partners
IK Investment Partners is a leading mid-market private equity firm, managing circa EUR 7 billion of funds raised from European and international institutional investors.
Since 1989, IK has invested in more than 88 companies in Europe. IK principally invests in mid-sized companies with strong cash flow and profit improvement potential, operating in mature industries with fundamental underlying growth (organic or external). Over the years, IK has developed an extensive experience in various sectors, including food ingredients and food.
For more information: www.ikinvest.com

About SFK Food
SFK Foods, originally founded in 1931 as a wholesaler, is a Danish manufacturer of ingredients to the food industry merged with W. Oschatzchen Aarhus resulted in a combined 170 years of experience in the ingredients industry. Product range includes spices, blends, herbs and vegetables, marinades / sauces soups, ready (and ready to cook) meals. SFK Foods is majority owned by Odin Equity Partners following its acquisition in 2012.
For more information: www.sfkfood.dk

Recapitalisation deal participants
• Solina : Eric Terre, Bertrand Vaz, Laurent Weber
• IK Investment Partners : Dan Soudry, Rémi Buttiaux, Arnaud Bosc, Diki Korniloff, Thibaut Richard, Caroline Le Hen
• Financial Due Diligence: Ernst & Young (Laurent Majubert, Gabriel Morales, Thibault Mignonac, Fanny Colson, Aurelie Buchinet)
• Bank documentation (Solina): Willkie Farr & Gallagher (Paul Lombard, Igor Kukhta)
• Bank documentation (Banks): Latham Watkins (Lionel Dechmann, Xavier Farde)
• Lead arranger banks:
o CA-CIB (Thibery Gleizes, Francois de Montlivault)
o BNP Paribas (Gilles Vanel, Pierre-Louis Nahon, Pierre Pessans-Goyheneix)

SFK acquisition participants
• Solina: Eric Terre, Bertrand Vaz, Laurent Weber
• SFK: Kjeld Kronborg Danielsen, Casper Sorensen
• IK Investment Partners: Dan Soudry, Rémi Buttiaux, Arnaud Bosc, Diki Korniloff, Thibaut Richard, Caroline Le Hen
• Odin Equity: Jacob Bergenholtz
• Financial Due Diligence: Mazars (Tomas Ahlgren, Asa Andersson Eneberg)
• Tax and Structuring Due diligence: Accuratax (Ria Falk, Peter Oestergaard)
• Legal and Corporae Due diligence (Solina): Plesner (Tina Kang)
• Corporate Lawyers (Solina): Plesner (Tina Kang), Willkie Farr & Gallagher (Eduardo Fernandez)
• M&A advisor (Seller): Stamford Partners (Marco Acaia, Alaistair Mathieson, Ben Legros, Sean Slater)

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