Tue, 30 Apr 2013 | BUSINESS SALE
PAI Partners has agreed to a £715 million deal to purchase strongly performing brand R&R Ice Cream.
The North Yorkshire-based ice cream maker controls about ten per cent of the British market and is Europe’s largest own label ice cream manufacturer. It is behind several iced treats including the Skinny Cow bars, Fab Lollies, and Chokablok Ice Cream for Tesco.
The deal will mark the US private equity firm’s first acquisition in the UK food sector since 2006, when it bought a stake in United Biscuits. PAI Partners was advised by Rothschild and Credit Suisse, and is to pay private equity firm Oaktree Capital Management and R&R’s management £715 million. It will be partially paid with a €250 million Payment in Kind toggle note, which enables borrowers to pay interest in debt, rather than in cash, to be fully repaid at a later date.
The purchase is still subject to regulatory approval and some finance conditions being met.
Employing 3,500 people, R&R has 11 manufacturing sites throughout Britain and Europe. It also has a business that makes branded ice creams for Disney and Nestle. The business announced recently that it is to start producing chocolate and vanilla Mickey and Minnie Mouse ice cream lollies.
British ice cream eaters consumed over £1 billion worth of the stuff last year, despite the cold weather.
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