Egeria sells Dutch Bakery to 3i

The deal values the company in the EUR 100m region. 3i declined to comment and Egeria had not responded to a request for comment at the time of publication.

Unquote sister publication Mergermarket reported in March 2021 that Egeria had hired Rothschild to run the sale process for Dutch Bakery. Sources told Mergermarket that Egeria was basing its sale based on the company's EBITDA of more than EUR 11m.

The company performed strongly during the Covid-19 pandemic, sources said, adding that the company's buy-and-build potential could appeal to buyers. However, Mergermarket reported that there were questions around how the company would perform after the pandemic and if customers might shift from home-bake products to fresh goods.

In October 2017, Egeria acquired a majority stake in Dutch Bakery from Standard Investment, which had owned the company since 2014. Mergermarket reported at the time that Dutch Bakery was expected to be marketed based on EBITDA of at least EUR 10m in its sale process and was expected to be sold for around 8x EBITDA.

Egeria invested in Dutch Bakery via Egeria Private Equity Fund IV. The vehicle held a final close in December 2012 on EUR 600m. The GP invested in frozen snack producer GoodLife Foods in May 2014 via the same vehicle.

3i said in a statement that it intends to support the company's international growth, pursuing a consolidation strategy in the European private-label bake-off products market. The GP cited e-commerce, more time spent at home, and food market "premiumisation" as key market drivers.

The GP has previously invested in private label brands including personal products company Royal Sanders (which it also acquired from Egeria) and fruit juice and soft drinks producer Refresco.
Dutch Bakery's competitors include France-based Menissez (which was previously backed by ICG) and Germany-based Sinnack, Mergermarket previously reported.

The deal is expected to close in October 2021 and remains subject to competition authority approval.

Unquote recently reported on the dynamics at play for PE players in the food and beverage sector amid rising valuations. The article was produced as part of the latest Clearwater Multiples Heatmap, which can be read here.

Company
Dutch Bakery produces home-bake products including bread and snacks such as sausage rolls, as well as dough for croissants, cheese twists and kampioentje. Its products are sold by food retailers in the Netherlands and abroad, and the company uses modified atmosphere packaging to extend the shelf life of its goods.

Dutch Bakery is headquartered in Tilburg and operates six bakeries. The firm traces its roots back to 1936. It posts revenues of EUR 100m and employs 321 staff, according to Egeria's website.

People
Dutch Bakery – Raoul Vorage (CEO).
Egeria – Sander van Keken (investment director); Floris Waage (managing partner); Ryan de Regt (associate).
3i – Bastiaan Peer (director).

Advisers
Equity – Axeco (corporate finance); PwC (corporate finance).

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