Permira fingers a sale for Birds Eye

by Rupert Steiner - 18/08/2011

"The private equity owner behind Birds Eye fish fingers has held early stage discussions which could lead to a £1.5bn sale of the business. "

Sources close to Birds Eye Iglo – which was bought by Permira in a £1.16bn deal in 2006 – say the private equity firm has held recent meetings in which it has pushed for a sale of Europe’s biggest frozen food supplier within the next six months.

It wants to capitalise on a bumper trading update, posted last week, in which the business saw an 8.3pc rise in half-year operating profit.


Tasty offer: The private equity firm wants to capitalise on a recent bumper trading update

But sources close to Permira insist a decision has not yet been taken and concerns over stock market volatility make any sale environment uncertain.

Private equity firms have become increasingly nervous about announcing upcoming disposals, having had to shelve a number of floats due to the market turmoil last year.

In February 2010 Blackstone was forced to pull the £2bn float of Madame Tussads owner Merlin Entertainment as well as a £1.2bn listing of Travelport.

Birds Eye, famous for generations for its frozen peas and fish fingers, has seen a recent boost in trading following a series of new product launches across several countries.

In Germany it launched new poultry products including Chicken Bakes, Cordon Bleu and a relaunch of Chicken Wings.

Rice Fusions and Catch Fresh Seafood have also been popular in the UK.

The firm said group sales for the first half of the year were up 3.5pc and there has been a partial refinancing of its £1bn debt pile which will deliver a 20pc reduction in its interest rate bill.

Its acquisition of Findus Italy for £675m from Unilever in July last year has also helped the business, run by chief executive Martin Glenn, grow.

The source also said Permira has not staged a beauty parade of bankers to advise on a sale of Birds Eye Iglo, which is thought to be worth around £1.5bn.

A spokesman for Permira declined to comment. Bird’s Eye was founded in 1922 and by 1943 Unilever had taken control on becoming the majority shareholder in Frosted Foods, which held British rights to a new food preservation method – deep freezing.

In 2006 Permira bought the business outbidding CapVest, a rival private equity group that owns FoodVest, a firm which includes Findus frozen foods in Norway, Sweden and France, as well as Young’s Bluecrest seafood in the UK.

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