Pacific Equity Partners is about to get full control of Patties Foods, the maker of Four’n Twenty pies traditionally consumed at sporting events, for $231.8 million.
The Patties board has recommended the $1.65 cash a share offer for 100% of the company. Its shares last traded at $1.58 after jumping more than 20% when news of the bid broke.
Members of the company’s founding Rijs family, which hold 36.6% of the shares, say they intend to vote to accept the offer.
“Whilst the board remains confident in management’s plans for growth and innovation in the core brands and the business is experiencing strong momentum, the scheme represents an attractive value for shareholders,” says Patties chairman Mark Smith.
Pacific Equity Partners (PEP) says the opportunities for the frozen foods group under private ownership are exciting.
“Patties Foods is a market leading producer, supplier and marketer of frozen savoury and dessert products boasting a portfolio of iconic Australian brands including Four’n Twenty, Patties and Herbert Adams,” says PEP managing director David Brown.
“Patties’ manufacturing platform positions the business well for future growth.”
PEP has significant experience in consumer foods in Australia and New Zealand. It has owned Peter’s Ice Cream, Manuka Health, V energy drinks, Pinnacle Bakery, Tegel and Griffin’s Foods.
“These businesses have experienced significant growth under PEP ownership and benefited from material investment in new product development, plant and equipment, export opportunities and acquisitions,” says Brown.
The takeover is expected to become final in September.
Patties is being advised by Greenhill & Co. and Minter Ellison.
The company last year sold its Creative Gourmet business after a Hepatitis A outbreak. More than 30 people were diagnosed with Hep A and government authorities believed at the time the common link was Patties Foods’ frozen berries.