Year-End Review
Food for Thought
Overview, Analysis, and Trends in the Food and Food Retailing Industries William Blair
Table of Contents
William Blair’s Industry Update – Calendar 2014 ...... 1 Selected Monthly M&A Activity – December ...... 2 Noteworthy M&A Activity – LTM ...... 7 Historical M&A Trends in the Food and Food Retailing Industries ...... 10 Volume Trends ...... 10 Participant Trends...... 11 Valuation Trends ...... 12 Public Company Trading Statistics ...... 13 Food Production Companies ...... 13 Food Ingredients Companies ...... 14 Beverage Production Companies ...... 14 Food Retail Companies...... 15 Convenience Store Companies ...... 15 Same-Store Growth – Food & Convenience Retail ...... 16 U.S. Public Equity Financing Summary – LTM ...... 17 IPOs ...... 17 Follow-Ons ...... 17 Selected Upcoming Industry Events ...... 18 General Market Update ...... 20 Quarterly Market Update – All Industries...... 20 Domestic M&A Market Summary ...... 21 U.S. Activity Trends ...... 21 U.S. Valuation Trends ...... 22 U.S. Equity Capital Markets Summary ...... 23 Debt Capital Markets Summary ...... 24 William Blair Food & Beverage and Food Convenience & Retail Investment Banking ...... 25 Recent William Blair Consumer & Retail Transactions ...... 27 William Blair Consumer & Retail Coverage ...... 28 Notes ...... 29 Disclosures ...... 30
Food For Thought Table of Contents
William Blair
William Blair’s Industry Update – Calendar 2014
Twelve months ago, we finished one of the most active years for food retail in over a decade. Both the M&A and equity markets were particularly robust for food retailers, and we predicted that 2014 was going to continue that trend. While the M&A market has shown continued strength, the publicly traded food retailers had a tougher time, as inflationary pressures, particularly on beef and dairy, have in turn pressured margins, and competitive factors from within—and outside—the food retail industry affect customer traffic and basket size.
M&A activity remained robust in food retail, and after a noticeable hiatus in convenience stores, headline M&A transactions returned. Four notable food retail transactions hit the wires in 2014: 1) the sale of Safeway to Albertsons in March for $8 billion; 2) the sale of Grocery Outlet to Hellman & Friedman from Berkshire Partners in September; 3) the sale of Dean & DeLuca, an iconic brand in the upscale food retail market, to a Thai property developer, Pace Development, in November for $144 million; and 4) the purchase of 146 Safeway, Vons, Pavilions, and Albertsons stores by Haggen in December. The last transaction caught the industry by surprise, as Haggen, an 18-store operator in Bellingham, Washington, backed by Comvest Partners, bought a surprising number of stores that were being divested as a result of an FTC order to allow the Safeway/Albertsons transaction to proceed. This immediately makes Haggen a player in the West Coast food retail market, with 164 stores in five states; it does not come without risk, however, as 83 of these stores are in highly competitive markets in California. In convenience stores, two transactions punctuated the landscape, including the sale of Susser to Energy Transfer Partners, the parent company of the Sunoco brand, for $2.3 billion in April, and the sale of The Pantry to Couche-Tard for $1.7 billion in December.
In the capital markets, public food retailers faced headwinds from both rising food costs and strong competitive factors. William Blair’s food retail group was down 4.3% for 2014, and some of the strongest performers of 2013 saw headwinds affect their stock prices in 2014. Natural Grocers by Vitamin Cottage, which saw a 122% increase in 2013, declined 33.6% in 2014, and Sprouts Farmers Market, up 110% following a very successful IPO in August 2013, declined 11.6% in 2014. One anticipated IPO of 2014, Bi-Lo Holdings, the holding company for BI-LO and Winn-Dixie, was also withdrawn in August. Most noticeably, the industry also saw meaningful change in the executive office, with three public food retailers replacing their CEOs. Fairway Market appointed Jack Murphy, formerly CEO of Earth Fare, as CEO in August to lead the turnaround of the iconic New York specialty food retailer. And coming right out of the holidays, in January 2015 The Fresh Market announced that Craig Carlock was leaving as CEO and Bi-Lo Holdings announced that Randall Onstead was stepping down March 1. He will be replaced by Ian McLeod, the former CEO of Coles, an Australian food retailer.
As we look to 2015, we do not expect many headline M&A transactions in the sector, as the activity will be dominated by market exits and smaller consolidations driven by market position, scale, and operating leverage. We also expect the equity markets to be fairly quiet, though overall, we believe the industry to be very healthy, and following a down year in 2014, we expect stock prices to appreciate as the U.S. consumer remains strong, food inflation pressures have abated, and discretionary income is being increased, in part, by low gas prices.
Mike Siska Managing Director, Consumer and Retail +1 312 364 5393 [email protected]
Food For Thought William Blair’s Industry Update – Calendar 2014 1
William Blair
Selected Monthly M&A Activity – December
Food & Beverage Producer Transactions
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/31/14 China Minzhong Food Corporation China Private Investor $271.5 0.61x 2.3x Producer and seller of fresh vegetables
12/31/14 Inner Mongolia Mengniu Dairy Company China China Dairy (Mauritius) $6,039.2 - - Manufacturer of dairy products Limited
12/30/14 THAMIRA Cyprus Handy Snacks - - - Manufacturer and distributor of food and beverage products 12/30/14 Mount Shivalik Industries India Mount Shivalik Packaging - - - Manufacturer and seller of beer in India
12/30/14 Sump & Stammer Germany Transgourmet Holding - - - Producer and supplier of commercial food products
12/26/14 Ishiyamamiso Syouyu Inc. Japan Undisclosed Acquirer - - - Manufacturer of soy sauces and related products
12/25/14 Water Direct Corp. (73.4%) Japan Hikari Tsushin Inc. $55.2 0.76x 5.6x Manufacturer and distributor of purified water
12/25/14 Distant Lands Trading Co. United States ITO EN (North America) $83.2 0.06x - Roaster and distributor of coffee
12/25/14 Country Pure Foods United States Sapporo Holdings Ltd; $99.6 - - Producer of fruit juices, soft drinks and spring water Toyota Tsusho Corp.
12/25/14 Syuyo Shoji Co. Japan Taisei Co. (Fukuoka) - - - Manufacturer of confectionery products
12/24/14 Henri Maire France Boisset - - - Producer of wine
12/24/14 Tovarna Olja Slovenia KD Group - - - Producer and marketer of vegetable oils and fats
12/24/14 International Confections United States Mrs. Fields Famous Brands - - - Manufacturer of sweets and chocolates
12/23/14 Dairy Holdings New Zealand Undisclosed Acquirer - - - Supplier of milk and dairy ingredients
12/23/14 Emmi Fondue (34%) Switzerland Emmi - - - Manufacturer of dairy products
12/22/14 Blue Buddha Beverages United States Braintrust Investments - - - Manufacturer of ready-to-drink teas
12/22/14 Lontrue Co. (9.9%) China Private Investor (Yang $504.9 3.83x 27.4x Manufacturer and supplier of fruits, vegetables and nuts Jianwei)
12/22/14 Moulin D'Or Tunisia Undisclosed Acquirer - - - Manufacturer of bread and bakery products
12/22/14 Heinrich Nolke Germany zur Mühlen ApS & Co. - - - Producer and seller of sausages in Germany
12/19/14 Swartland Winery South Africa Private Investor - - - Producer of wine
12/19/14 NESTLÉ México (Helados Nestle) Mexico Grupo Herdez $68.2 - - Manufacturer of ice-cream
Note: Includes global change-of-control (unless otherwise indicated) transactions announced in December 2014 Sources: Dealogic and Capital IQ
Food For Thought 2 Selected Monthly M&A Activity – December
William Blair
Food & Beverage Producer Transactions (cont.)
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/19/14 Takizawa Ham Co. (15.4%) Japan Itochu Corp. $64.2 0.26x - Manufacturer of ham, sausages, and other processed meat products 12/19/14 Radenska Slovenia Kofola Spolka Akcyjna - - - Producer of non-alcoholic beverages and soft drinks
12/19/14 Agros-Nova Poland Maspex GMW - - - Processer and distributor of fruits and vegetables
12/19/14 Longwarry Food Park Australia Parmalat Australia $66.7 0.91x - Manufacturer of cheese, cream and milk
12/18/14 La Rioja Alta (Winery located in Rioja Alta) Spain Bodega Matarromera - - - Producer of wine
12/18/14 Saputo Bakery Group Canada Canada Bread Company $103.4 - - Manufacturer and marketer of snack-cakes and bakery products 12/18/14 Tagum Resources Agri Industries Philippines HIJO Resources Corporation; $13.2 - - Producer of bananas Black River Capital Partners Food Fund Holdings 12/18/14 Bumble Bee Holdco Luxembourg Thai Union Frozen Products $749.9 0.75x - Manufacturer of canned and pouched seafood
12/18/14 Tyris Spain Zriser - - - Manufacturer and distributor of beer
12/17/14 L’ Epi Bearnais France Baghera Developpement - - - Operator of a bakery
12/17/14 Bakkerij J.M. Smithuis Netherlands Bakkerij Faber - - - Producer of bakery products
12/17/14 Bodega del Narcea Spain Bodega Dominio del - - - Manufacturer of wine Urogallo
12/17/14 Eskimo Nicaragua Grupo Lala - - - Producer and distributor of milk, yoghurt, and related dairy products 12/17/14 Founders Brewing Co. (30%) United States Mahou - - - Brewer and marketer of beer
12/17/14 Henan Khong Guan Cereal & Oil Food Products Co. China Undisclosed Acquirer - - - (40.6%) Manufacturer of edible oils 12/16/14 Sendai Coca-Cola Bottling Co. Japan Coca-Cola East Japan $88.4 0.18x - Producer of soft drinks
12/16/14 Abafoods Italy Koninklijke Wessanen $64.9 1.93x - Producer of organic beverages
12/16/14 Latterie Friulane Italy Lactalis Group - - - Manufacturer of dairy products
12/16/14 Dongbu Farm Gaya Co. (94.4%) South Korea Woongjin Foods $13.5 - - Manufacturer of soft drinks and juices
12/15/14 Archer Daniels Midland (Global Cocoa Business) United States Olam International $1,300.0 - - Producer of cocoa
12/12/14 Bahus (51%) Russian Cormistar Management - - - Producer of Vodka Federation
12/12/14 PoViva Tea (51%) Canada Lexaria Corp. - - - Manufacturer of tea
Note: Includes global change-of-control (unless otherwise indicated) transactions announced in December 2014 Sources: Dealogic and Capital IQ
Food For Thought Selected Monthly M&A Activity – December 3
William Blair
Food & Beverage Producer Transactions (cont.)
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/12/14 Robertet Savoury Belgium Nactis - - - Manufacturer of food and beverage additives
12/12/14 Ege-Tav Ege Tarim Hayvancilik Yatirim Ticaret ve Turkey NH Foods $120.0 - - Sanayi (60%) Producer and distributor of poultry 12/11/14 Handmade Cake Company United Kingdom Europeenne des Desserts - - - Producer and seller of handmade cakes
12/11/14 Momokawa Brewing Inc. Japan Hakutsuru Sake Brewing Co. - - - Manufacturer of Japanese sake
12/10/14 Comercializadora Novaverde (66.7%) Chile Angelini Group (Chile) - - - Manufacturer and seller of canned fruits and vegetables
12/10/14 Hainan Tanniu Chicken Co. (10%) China Private Investor (Ms. Yu $15.7 - - Producer of chicken and related food products Jiying)
12/10/14 Great Lake Tomatoes New Zealand Turners & Growers $13.4 - - Producer and seller of tomatoes
12/09/14 Nature Bev United States CleanPath Resources Corp. - - - Producer and distributor of sports drinks and nutritional beverages 12/09/14 Xiamen Sunurt Marine Co. China Cnfc Overseas Fishery Co. $38.5 0.77x - Processer and distributor of seafood
12/08/14 Cater Chain Food Services South Africa Famous Brands - - - Producer of meat products
12/08/14 Bio Distrifrais Chantenat France Private Investor - - - Wholesaler of fruits and vegetables
12/08/14 Gemacom Tech Industria e Comercio Brazil Tate & Lyle - - - Manufacturer of specialty food ingredients
12/05/14 Wine & Co. France Compagnie Financiere - - - Producer and seller of wine Europeenne de Prises de Participation 12/05/14 Bonjoe Gourmet Chips United States Great Plains Holdings - - - Producer of gourmet potato chips
12/05/14 Osaka Daiichi Rice Deal Co. Japan Itochu Corp. - - - Wholesaler of rice related food products
12/05/14 Tilly-Sabco France M S Foods - - - Manufacturer and processer of frozen meat products
12/05/14 McCleskey Mills United States Olam International $179.0 - - Provider of shelled peanuts
12/05/14 J. Garcia Carrion (4%) Spain Private Investor $482.3 - - Manufacturer of fruit juices, soft drinks and wine
12/04/14 F Delikappa Co. (45%) Japan Colowide Co. - - - Manufacturer of rice and sushi
12/04/14 Mentor Foods Brazil Dr. Schar - - - Manufacturer of gluten free food
12/04/14 Allan Candy Group Canada The Hershey Company $24.6 - - Manufacturer of chocolate and confectionery products
12/04/14 Rudolf Schaer Switzerland Migros-Genossenschafts- - - - Manufacturer of meats and meat products Bund
Note: Includes global change-of-control (unless otherwise indicated) transactions announced in December 2014 Sources: Dealogic and Capital IQ
Food For Thought 4 Selected Monthly M&A Activity – December
William Blair
Food & Beverage Producer Transactions (cont.)
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/03/14 734 Citrus Holdings United States Alico $72.0 - - Producer of oranges and citrus fruits
12/03/14 Limestone Branch Distillery (50%) United States Luxco - - - Producer and seller of whiskey
12/03/14 Korea Food Services (14%) South Korea Reyes Holdings $52.1 - - Manufacturer of bread and bakery products
12/02/14 Embutidos Monells Spain Grupo Alimentario Argal - - - Manufacturer and marketer of sausages and meat processing products 12/02/14 Talenti Gelato United States Unilever - - - Manufacturer of ice-cream
12/01/14 Grant Burge Wines Australia Accolade Wines Australia - - - Producer and distributor of wine in Australia Holdings
12/01/14 Razgulay Group (8.2%) Russian Aton Group $34.6 2.10x - Manufacturer of sugar, grain, poultry, and dairy products Federation
12/01/14 Noon Pakistan Limited Pakistan Fauji Fertilizer Bin Qasim - - - Processer and seller of dairy products
12/01/14 Nissin-Universal Robina Corp. (24%) Philippines Nissin Foods Holdings - - - Manufacturer and seller of instant noodles
12/01/14 Prestige (99%) Russian Rosspirtprom - - - Manufacturer of alcoholic beverages Federation
12/01/14 Kancor Ingredients India V. Mane Fils - - - Manufacturer of spice extracts and food additives
12/01/14 Summergate Fine Wines & Spirits China Woolworths $25.0 - - Provider of alcoholic beverages
Note: Includes global change-of-control (unless otherwise indicated) transactions announced in December 2014 Sources: Dealogic and Capital IQ
Food For Thought Selected Monthly M&A Activity – December 5
William Blair
Food & Convenience Retail Transactions
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/23/14 Super Sansho Co. Japan Undisclosed Acquirer - - - Operator of a chain of supermarkets 12/19/14 Supermarkets (3 supermarkets) Japan Aeon Co. - - - Operator of a chain of supermarkets 12/19/14 Safeway (12 stores in Texas) United States Associated Wholesale - - - Operator of a chain of grocery stores Grocers 12/19/14 Supermarkets (146 Safeway, Vons, Pavilions, and United States Haggen Inc. - - - Albertsons stores) Operator of a chain of supermarkets 12/19/14 Supermercados Montserrat (40%) Chile Inversiones Fontibre $109.5 - - Owner and operator of a chain of supermarkets 12/19/14 Safeway (8 stores in Montana and Wyoming) United States Ridley's Food Corporation; - - - Operator of a chain of food retail stores Stoke Market 12/19/14 Albertsons (2 stores in Washington) United States SUPERVALU - - - Operator of grocery stores in Washington 12/18/14 The Pantry United States Alimentation Couche-Tard $1,725.4 0.26x 7.8x Operator of convenience stores that sell groceries and other items 12/18/14 Grupo Carrefour (10%) Brazil Peninsula Participacoes $6,602.6 - - Operator of hypermarkets 12/17/14 Sunny Mart (16 convenience stores in Ehime and Japan Lawson - - - Tokushima) Operator of convenience stores 12/16/14 Andy's Handy Store United States Private Investor - - - Retail store operator that sells groceries and other items 12/16/14 Super Daiei Co. (24%) Japan Izumi Co. $29.0 0.15x 10.8x Operator of a chain of supermarkets 12/12/14 Aadhaar Wholesale Trading and Distribution India Future Consumer $26.6 1.26x - Owner and operator of supermarkets in India Enterprise Limited 12/08/14 Kasumi Co. Japan Undisclosed Acquirer - - - Operator of a chain of supermarkets Note: Includes global change-of-control (unless otherwise indicated) transactions announced in December 2014 Sources: Dealogic and Capital IQ
Food For Thought 6 Selected Monthly M&A Activity – December
William Blair
Noteworthy M&A Activity – LTM
Food & Beverage Producer Transactions
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/31/14 Inner Mongolia Mengniu Dairy Company China China Dairy (Mauritius) $6,039.2 - - Manufacturer of dairy products Limited 12/15/14 Archer Daniels Midland Company (Global Cocoa United States Olam International $1,300.0 - - Business) Producer of cocoa 11/20/14 Primo Smallgoods Australia JBS $1,255.4 - - Producer of packaged meats 11/06/14 DSS Group United States Cott Corp. $1,250.0 - - Producer and distributor of bottled water 11/03/14 Centrale Laitiere Morocco Danone $1,677.9 2.10x 17.1x Producer and seller of packaged milk and dairy products 11/03/14 United Biscuits United Kingdom Yildiz Holding $3,199.2 - - Manufacturer and distributor of biscuits, snacks, and frozen foods 10/20/14 Hainan Yedao Co. (11.2%) China China Orient Capital $679.0 6.19x - Manufacturer of food and beverage products Investment Group 10/06/14 Belvedere (7.3%) France Diana Holding - Groupe $362.7 0.54x NMF Producer and marketer of alcoholic beverages Zniber 09/10/14 Windsor Quality Food Company United States Ajinomoto North America $800.0 1.19x - Producer and marketer of frozen foods and appetizers 09/08/14 Annie's United States General Mills $821.2 3.95x NMF Producer of natural and organic foods 09/02/14 Archer Daniels Midland Company (Global Chocolate United States Cargill $440.0 - - Business) Producer of chocolate 08/21/14 Ebro Foods (2%) Spain Empresas Comerciales e $3,589.8 1.37x 9.5x Manufacturer of pasta, rice, and ready-to-eat food Industriales Valencianas 08/15/14 Vietnam Dairy Products (2%) Vietnam Fraser & Neave $4,534.6 2.90x 14.1x Manufacturer of dairy products 08/11/14 Chiquita Brands International United States Sucocitrico Cutrale; $1,193.1 0.39x 13.6x Producer and distributor of fruit and other fresh produce Banco Safra, Investment Arm 08/11/14 Treasury Wine Estates Australia TPG Capital $3,323.0 2.00x 14.2x Producer and distributor of wine
07/14/14 Russell Stover Candies United States Chocoladefabriken Lindt & $1,400.0 - - Manufacturer and marketer of sweets and chocolates Spruengli
07/07/14 WILD Flavors Switzerland Archer Daniels Midland $3,096.5 2.28x - Manufacturer of food ingredients and preservatives Europoort 06/30/14 CytoSport United States Hormel Foods Corporation $470.0 - - Manufacturer of nutritional supplements 06/30/14 Flagstone Foods United States Treehouse Foods $860.0 - - Producer and distributor of dried fruits and nuts 05/29/14 Hillshire Brands Co. United States Tyson Foods $8,533.5 2.10x 15.3x Manufacturer of consumer food and beverage products 05/22/14 Conopco (North America Pasta Sauces Business) United States Mizkan Holdings $2,150.0 3.60x - Producer of pasta sauce 05/21/14 Tnuva Food Industries Israel Bright Food (Group) $1,711.2 - - Producer and distributor of dairy and frozen food products Note: Includes global change-of-control (unless otherwise indicated) transactions announced in the last twelve months Sources: Dealogic and Capital IQ
Food For Thought Noteworthy M&A Activity – LTM 7
William Blair
Food & Beverage Producer Transactions (cont.)
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 05/20/14 Treasury Wine Estates Australia KKR & Co. $3,188.3 1.90x NMF Producer and distributor of wine 05/12/14 Pinnacle Foods United States Hillshire Brands $6,729.2 2.70x 15.2x Manufacturer of convenience food products 04/27/14 Goodman Fielder Australia First Pacific Company $1,698.4 0.84x 8.8x Manufacturer and distributor of food ingredients 04/25/14 Deoleo Spain CVC Capital Partners $1,261.8 1.16x 12.5x Producer of cooking oils 04/17/14 MFI Holding Corporation United States Post Holdings $2,499.5 - - Processer and distributor of commercial food products 04/15/14 United Spirits India Diageo $1.895.8 4.88x NMF Manufacturer and seller of alcoholic beverages 04/14/14 DIANA France Symrise $1,796.2 2.88x 14.0x Provider of organic and natural foods 03/17/14 Hearthside Food Solutions United States Goldman Sachs Group, $1,100.0 1.10x - Manufacturer of consumer baked foods and snacks Merchant Banking Division; Vestar Capital Partners 03/14/14 Olam International Singapore Temasek Holdings; $11,546.7 0.73x 13.0x Supplier of food ingredients such as coffee, cocoa and Kewalram Singapore cashew nuts 03/10/14 Cloverhill Pastry-Vend United States Aryzta $673.1 - - Producer of baked goods primarily sold through vending machines 03/03/14 Nuova Castelli Italy Charterhouse Capital $516.6 1.29x 10.1x Producer and distributor of dairy and canned tuna fish Partners products 02/28/14 Sokolow Poland Danish Crown $492.6 - - Processer of packaged meats such as canned hams, kielbasa and pre-packaged sliced meats 02/20/14 Shree Renuka Sugars (26%) India Wilmar International $1,331.2 0.79x 11.9x Manufacturer of sugar 02/12/14 Canada Bread Co. Canada Grupo Bimbo $1,487.6 1.06x 12.6x Manufacturer of flour based products 01/20/14 Oriental Brewery Co. South Korea Anheuser-Busch InBev $5,800.0 - - Brewer and marketer of beer
01/13/14 Tilda United Kingdom Hain Celestial Group $357.7 - - Provider of basmati and specialty rice products 01/13/14 Beam United States Suntory Holdings $15,816.6 6.27x 20.4x Manufacturer and seller of distilled spirits Note: Includes global change-of-control (unless otherwise indicated) transactions announced in the last twelve months Sources: Dealogic and Capital IQ
Food For Thought 8 Noteworthy M&A Activity – LTM
William Blair
Food & Convenience Retail Transactions
($ in millions)
Date Target (Unit Sold)/ Target Enterprise Enterprise Value/LTM Announced Target Business Description Nation Buyer Value Sales EBITDA 12/18/14 The Pantry United States Alimentation Couche-Tard $1,725.4 0.26x 7.8x Operator of convenience stores that sell groceries and other items 12/18/14 Grupo Carrefour (10%) Brazil Peninsula Participacoes $6,602.6 - - Operator of hypermarkets 11/24/14 Dean & DeLuca United States Pace Development $140.0 - - Operator of retail stores that sell gourmet specialty food Corporation and beverage products 11/07/14 Nature's Pantry United States Natural Grocers by Vitamin - - - Operator of a chain of food retail stores Cottage 10/31/14 Maruetsu Japan Kasumi $685.6 0.23x 7.5x Operator of a chain of supermarkets 10/03/14 Migros Ticaret Turkey Anadolu Endüstri Holding $2,705.4 0.79x 13.1x Operator of a chain of supermarkets 09/30/14 Seijo Ishii Co. Japan Lawson $501.4 1.01x 9.7x Operator of a chain of supermarkets 09/16/14 Grocery Outlet Inc. United States Hellman & Friedman - - - Operator of a chain of grocery stores 08/11/14 Kinsho Store Co. Japan Kintetsu Corporation $645.3 1.13x - Operator of a chain of supermarkets
07/02/14 Grupo El Árbol Distribución y Supermercados Spain Distribuidora Internacional $205.9 0.18x - Supermarkets operator de Alimentación
06/03/14 DIA France France Carrefour $816.9 - - Operator of a chain of supermarkets 05/07/14 Roundy's (18 Rainbow Stores) United States SuperValu $65.0 - - Operator of 18 retail stores 04/28/14 Susser Holdings Corporation United States Energy Transfer Partners $2,320.3 0.37x 14.4x Operator of a chain of convenience stores 04/11/14 SPAR Group South Africa Allan Gray $2,059.8 0.45x 13.0x Operator of a chain of grocery and retail stores 04/07/14 Carrefour France Motier $1786.3 0.36x 12.2x Operator of a chain of supermarkets 03/11/14 SPAR Ceska Obchodni Spolecnost Czech Republic Albert (Ahold) $266.2 0.36x - Operator of a chain of supermarkets 03/10/14 Eataly Italy Tamburi Investment $832.7 - - Operator of a chain of food retail stores Partners 03/06/14 Safeway United States Albertsons (Cerberus $8,198.9 - 13.5x Operator of a chain of stores offering a selection of food Capital Management) and general merchandise 03/04/14 Wumart Stores China Wumei Holdings $559.8 0.20x 4.4x Operator of a retail chain of superstores 02/13/14 Sobeys (29 stores) Canada Overwaitea Food Group; $391.0 - - Operator of a chain of grocery stores Federated Co-operatives 02/11/14 Walmart Chile Chile Inversiones Australes Tres $7,575.8 1.36x 15.1x Operator of a chain of supermarkets Limitada 01/31/14 Izumiya Co. Japan H2O Retailing Corporation $1,099.2 0.33x 11.6x Operator of retail stores that sell groceries and other items Note: Includes global change-of-control (unless otherwise indicated) transactions announced in the last twelve months Sources: Dealogic and Capital IQ
Food For Thought Noteworthy M&A Activity – LTM 9
William Blair
Historical M&A Trends in the Food and Food Retailing Industries
Volume Trends
U.S. Monthly Announced M&A Activity
Food & Beverage Production Food Retail & Convenience Number of Deals Number of Deals 20 30 22 19 18 17 15 17 15 15 17 20 13 12 14 15 10
0 10 01/14 2/14 03/14 04/14 05/14 06/14 07/14 08/14 09/14 10/14 11/14 12/14 Food & Beverage Production 13 15 12 17 16 12 12 13 14 14 11 12 5 Food Retail & Convenience 4 7 3 2 1 1 0 1 1 1 6 6
0 U.S. Yearly10/10 Announced11/10 M&A12/10 Activity1/11 2/11 3/11 4/11 5/11 6/11 7/11 8/11 9/11 10/11
Food & Beverage Production Food Retail & Convenience Total Deal Value (B)
Number Deal Value of Deals ($ in billions) 300 $120 232 223 170 194 181 185 189 Deal Value 200 159 166 159 $80 Number of Deals 127 129 ($ in billions) 250 $100.0 200 100 $80.0$40 150 $60.0 100 $40.0 50 $20.0 0 $0.0 0 $0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Food & Beverage Production 98 128 101 145 127 106 79 109 127 161 147 161 Food Retail & Convenience 61 53 65 87 96 64 48 20 32 24 42 33 Total Deal Value $7.9 $13.5 $11.5 $29.1 $33.3 $93.3 $20.5 $39.0 $13.9 $36.0 $43.2 $59.9
Global Yearly Announced M&A Activity
Food & Beverage Production Food Retail & Convenience Total Deal Value (B)
Number Deal Value of Deals ($ in billions) 1,500 1,325 1,311 $200 1,193 1,159 1,199 1,049 1,083 994 973 979 926 932 $150 1,000 Deal Value Number of Deals ($ in billions)$100 250 500 $100.0 200 $80.0$50 150 $60.0 100 $40.0 50 $20.0 0 0 $0.0$0 2001 20022003 20042003 20052004 20062005 2007 20062008 20072009 20082010 20112009 20122010 2013 20112014 Food & Beverage Production 859 799 870 996 1104 1042 948 969 906 814 768 792 Food Retail & Convenience 135 174 179 197 221 269 211 230 177 165 158 140 Total Deal Value $41.7 $61.1 $97.8 $94.9 $132.3 $140.5 $72.0 $94.2 $125.4 $127.4 $109.7 $134.2 Note: Data represents announced transactions including U.S.-based targets only Sources: Dealogic and Capital IQ as of December 31, 2014
Food For Thought 10 Historical M&A Trends in the Food and Food Retailing Industries
William Blair
Participant Trends
Breakdown of Acquirers by Type
Private Public Private Equity Foreign Percent of Deals 60%
50%
40%
Percent30% of Deals
60.0%20% 50.0% 40.0% 30.0% 20.0%10% 10.0% 0.0% 0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Private 43.0% 46.8% 44.1% 43.4% 51.9% 47.2% 50.0% 52.8% 49.5% 53.2% 56.0% 48.6% 47.2% Public 25.6% 24.0% 27.7% 28.0% 19.6% 21.6% 20.3% 17.4% 18.1% 15.6% 19.5% 25.8% 21.6% Private Equity 11.0% 11.0% 9.2% 10.1% 13.8% 17.2% 13.1% 13.0% 13.2% 12.2% 7.2% 13.6% 12.5% Foreign 20.3% 18.2% 19.0% 18.5% 14.6% 14.0% 16.7% 16.8% 19.1% 19.0% 17.3% 12.0% 18.8%
Breakdown of Sellers by Type
Private Public Private Equity Divestiture Percent of Deals
70%
60%
50%
40% Percent of Deals 30% 70.0% 60.0% 50.0%20% 40.0% 30.0% 20.0% 10.0%10% 0.0% 0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 YTD 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Private 50.0% 30.1% 46.4% 53.1% 50.5% 57.2% 46.3% 53.0% 49.7% 47.1% 53.4% 55.2% 53.4% Public 2.5% 3.3% 6.4% 5.6% 2.0% 1.7% 3.7% 5.1% 6.1% 4.8% 2.5% 4.9% 7.4% Private Equity 4.2% 17.1% 7.9% 9.1% 12.4% 8.1% 8.0% 8.5% 14.0% 5.3% 8.1% 7.8% 8.0% Divestiture 43.2% 49.6% 39.3% 32.2% 35.1% 32.9% 42.0% 33.3% 30.2% 42.8% 36.0% 32.1% 31.3% Note: Data represents announced transactions including U.S.-based targets only Sources: Dealogic and Capital IQ as of December 31, 2014
Food For Thought Historical M&A Trends in the Food and Food Retailing Industries 11
William Blair
Valuation Trends
Average EBITDA Multiples for Food Transactions(1)
Average EV/EBITDA Multiple Number of Disclosed Deals EV/EBITDA Multiple
20.0x 40
35
15.0x 30 13.2x 13.0x 13.0x 12.0x 12.0x 12.0x 11.8x 14.0x 11.4x 9.9x 10.4x 11.8x 30 12.0x 8.7x 8.6x 8.4x 11.4x9.1x 9.3x 8.2x 25 10.0x 9.1x 25 8.0x 9.9x 10.4x 20 6.0x 15 4.0x 10.0x 9.3x 10 20 2.0x 8.4x 5 0.0x 8.6x 8.2x 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 YTD 2011 15
5.0x 10
5
0.0x 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Average EV/EBITDA Multiple 8.6x 8.4x 9.1x 11.4x 9.9x 12.0x 10.4x 9.3x 8.2x 11.8x 13.2x 13.0x 13.0x Number of Disclosed Deals 20 25 20 14 28 23 20 14 11 7 17 22 34
Average EBITDA Multiples for Beverage Transactions(2)
Average EV/EBITDA Multiple Number of Disclosed Deals
EV/EBITDA Multiple
25.0x 20
20.0x 17.3x 15
14.1x 14.5x 15.0x 11.8x 13.5x 13.4x 13.6x 12.0x 11.7x 10.9x 11.8x 10 10.1x 12.9x9.5x 9.5x 11.8x 14.1x 12.0x 13.5x 13.4x 17.3x 9.8x11.7x 10.9x 9.8x 10.0x15.0x20.0x0.0x5.0x 10.0x 101214161802468 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 YTD 2011 5 5.0x
0.0x 0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Average EV/EBITDA Multiple 9.5x 11.8x 14.1x 12.0x 13.5x 13.4x 17.3x 11.7x 10.9x 9.8x 13.6x 14.5x 11.8x Number of Disclosed Deals 15 9 16 12 15 5 4 9 1 3 6 4 13 (1) Excludes Food & Convenience retail transactions (2) Includes alcoholic and nonalcoholic beverages Note: Data represents global transactions announced in the respective sectors Note: Transactions with multiples that are not meaningful are categorized as undisclosed Sources: Dealogic and William Blair as of December 31, 2014
Food For Thought 12 Historical M&A Trends in the Food and Food Retailing Industries
William Blair
Public Company Trading Statistics
Food Production Companies
($ in millions) % Change Forward Enterprise Value/LTM Enterprise Company Market Cap MTD YTD P/E PEG Value Sales EBITDA Nestlé $234,344.8 (2.2%) 0.1% NA NA $258,229.9 2.55x 13.6x Unilever $116,325.8 (3.2%) (0.4%) 17.2x 172.1% $129,810.6 1.96x 11.7x Mondelez International $61,023.2 (7.3%) 2.9% 18.3x 170.1% $77,233.2 2.21x 15.0x Danone $39,499.0 (6.6%) (8.5%) 16.0x 184.6% $51,575.1 1.82x 12.0x Associated British Foods $38,656.7 (1.9%) 21.3% 28.1x 290.1% $39,893.7 1.90x 15.6x General Mills $32,197.9 1.1% 6.9% 17.8x 226.8% $43,177.9 2.43x 13.0x Kellogg Company $23,233.4 (1.2%) 7.2% 15.4x 197.6% $30,581.4 2.10x 8.1x The Hershey Company $22,955.0 3.6% 6.9% 23.0x 270.1% $24,900.6 3.38x 15.5x ConAgra Foods $15,452.3 (0.7%) 7.7% 15.7x 236.0% $23,919.2 1.35x 10.1x Tyson Foods $15,041.9 (5.3%) 19.8% 13.5x 159.3% $22,794.9 0.61x 10.9x Campbell Soup Company $13,787.1 (2.8%) 1.7% 17.2x 286.9% $17,605.1 2.13x 11.3x Hormel Foods Corporation $13,735.5 (1.8%) 15.3% 23.3x 273.9% $13,657.7 1.50x 13.2x Grupo Bimbo $12,967.5 (1.9%) (10.2%) 23.1x 51.4% $17,319.7 1.26x 11.6x JBS $12,197.6 (9.5%) 13.5% 11.4x NA $23,360.7 0.51x 6.1x Saputo $11,779.0 3.8% 32.4% 9.6x 95.9% $13,602.9 1.50x 14.0x George Weston $11,096.3 (1.9%) 18.8% 15.9x 158.8% $28,733.0 0.86x 16.4x The J. M. Smucker Company $10,281.5 (1.6%) (2.5%) 16.1x 208.0% $12,596.4 2.29x 10.6x McCormick & Company $9,615.4 0.0% 7.8% 22.5x 272.7% $10,899.5 2.57x 15.0x Pilgrim's Pride Corporation $8,493.6 1.5% 101.8% 45.5x NA $8,130.4 0.95x 6.9x ARYZTA $6,830.4 (2.9%) 0.9% 13.3x 45.1% $9,167.5 1.42x 10.3x The Hain Celestial Group $5,882.6 3.0% 28.4% 17.0x 114.6% $6,677.4 2.89x 23.7x Flowers Foods $4,028.5 (1.6%) (10.6%) 16.3x 152.6% $4,837.0 1.30x 11.4x Treehouse Foods $3,620.2 5.7% 24.1% 21.3x 199.8% $5,151.7 1.91x 15.2x Lancaster Colony Corporation $2,560.4 (0.3%) 6.2% 22.8x 207.7% $2,332.8 2.22x 13.6x Tootsie Roll Industries $2,444.4 5.2% (3.0%) NA NA $2,372.2 4.38x 23.4x Snyder's-Lance $2,146.8 0.9% 6.6% 21.7x 144.6% $2,484.3 1.36x 12.9x J&J Snack Foods Corp. $2,030.4 3.5% 22.8% 28.5x 317.2% $1,939.2 2.11x 13.4x Sanderson Farms $1,945.3 (3.2%) 16.2% 9.2x NA $1,799.7 0.66x 4.8x Cal-Maine Foods $1,888.3 (6.8%) 29.6% 8.1x NA $1,743.9 1.18x 8.0x Fresh Del Monte Produce $1,887.4 (0.6%) 18.6% 14.0x 279.6% $2,029.8 0.52x 8.7x Post Holdings $1,879.2 4.7% (15.0%) 45.6x 569.9% $5,507.4 3.32x 22.4x Dean Foods Company $1,818.3 13.7% 12.7% 18.1x 245.9% $2,766.1 0.29x 12.6x B&G Foods $1,604.5 4.5% (11.8%) 16.6x NA $2,643.9 3.22x 14.1x Diamond Foods $886.9 (5.2%) 9.2% 33.1x 300.7% $1,534.6 1.77x 18.8x Lotus Bakeries $882.0 (1.5%) 14.9% 18.2x 181.9% $959.7 2.06x 12.1x Calavo Growers $818.0 10.2% 56.3% 29.4x 255.4% $846.0 1.10x 20.2x Chiquita Brands International $681.2 0.0% 23.6% 13.0x 325.7% $1,275.7 0.41x 12.7x Boulder Brands $676.1 2.4% (30.3%) 19.3x 110.0% $965.8 1.88x 14.1x John B Sanfilippo & Son $503.5 8.8% 84.4% NA NA $560.6 0.69x 9.8x Seneca Foods Corp. $300.5 (0.1%) (15.2%) NA NA $638.0 0.48x 18.3x Inventure Foods $248.9 (7.7%) (3.9%) 18.5x 135.4% $337.1 1.24x 14.9x Bridgford Foods Corp. $70.7 1.3% (19.1%) NA NA $69.7 0.53x NMF Golden Enterprises $41.5 (8.7%) (13.8%) NA NA $47.5 0.35x 7.5x Mean (0.3%) 11.0% 19.8x 213.8% $21,086.3 1.66x 13.2x Median (0.7%) 7.2% 17.8x 203.8% $5,507.4 1.50x 13.0x Note: Data as of December 31, 2014 Sources: FactSet Research Systems, Bloomberg, and Capital IQ; data is sometimes based on reported results and includes estimates
Food For Thought Public Company Trading Statistics 13
William Blair
Food Ingredients Companies
($ in millions) % Change Forward Enterprise Value/LTM Enterprise Company Market Cap MTD YTD P/E PEG Value Sales EBITDA Givaudan $16,616.2 1.3% 26.2% 22.3x 185.6% $17,817.9 3.65x 17.8x Kerry Group $12,144.6 (6.9%) (0.7%) 16.5x 145.4% $13,688.1 1.73x 14.4x International Flavors & Fragrances $8,207.3 0.2% 17.9% 18.4x 262.6% $8,750.6 2.86x 13.0x Symrise $7,876.9 1.5% 31.5% 22.5x 169.7% $9,442.4 3.75x 18.1x Barry Callebaut $5,637.1 (3.9%) (18.1%) 17.6x 80.5% $7,613.2 1.19x 13.8x Sensient Technologies Corporation $2,905.8 2.4% 24.4% 18.5x 194.5% $3,340.6 2.29x 12.4x Frutarom Industries $1,804.5 19.8% 46.9% 20.4x NA $1,973.7 2.60x 14.8x T. Hasegawa Co. $589.3 0.7% 3.0% 15.6x NA $400.2 0.89x 5.4x Takasago International Corporation $451.2 (1.4%) (19.2%) 11.2x NA $774.6 0.60x 8.6x Mean 1.5% 12.4% 18.1x 173.1% $7,089.0 2.17x 13.1x Median 0.7% 17.9% 18.4x 177.7% $7,613.2 2.29x 13.8x
Beverage Production Companies
($ in millions) % Change Forward Enterprise Value/LTM Enterprise Company Market Cap MTD YTD P/E PEG Value Sales EBITDA The Coca-Cola Company $184,928.4 (5.8%) 2.2% 18.9x 229.3% $203,247.4 4.40x 15.5x Anheuser-Busch InBev $182,555.5 (3.3%) 6.8% 19.1x 152.4% $229,221.5 4.90x 12.7x Pepsico $141,519.1 (5.5%) 14.0% 19.3x 235.0% $161,334.1 2.41x 12.6x SABMiller $84,173.2 (6.0%) 2.0% 18.6x 145.7% $98,946.2 5.83x 16.9x Diageo $72,196.0 (7.0%) (13.0%) 16.8x 163.7% $88,701.6 5.06x 15.2x Keurig Green Mountain $21,449.3 (6.9%) 75.3% 34.6x 191.5% $20,882.3 4.44x 17.3x Constellation Brands $18,965.4 1.8% 39.5% 21.8x 163.1% $26,058.7 4.44x 15.3x Brown-Forman Corporation $18,564.9 (9.5%) 16.2% 24.6x NA $19,451.9 6.37x 19.2x Monster Beverage Corporation $18,163.6 (3.4%) 59.9% 36.6x 261.7% $17,167.2 7.15x 23.8x Dr Pepper Snapple Group $13,935.2 (3.1%) 47.1% 19.5x 264.1% $16,210.2 2.67x 11.1x Molson Coors Brewing Company $13,876.5 (3.7%) 32.7% 17.2x 224.8% $16,635.7 3.96x 20.2x Coca-Cola Enterprises $10,689.5 0.6% 0.2% 13.7x 152.6% $14,619.5 1.75x 10.2x The WhiteWave Foods Company $6,100.8 (4.5%) 52.5% 30.5x 174.1% $7,430.0 2.32x 20.3x Boston Beer Co. $3,782.5 10.1% 19.7% 39.7x NA $3,725.9 4.18x 20.9x National Beverage Corp. $1,048.3 (10.0%) 12.2% NA NA $1,021.1 1.60x 12.7x Coca-Cola Bottling Co. $816.2 (6.9%) 20.3% 24.1x NA $1,369.7 0.81x 11.0x Cott Corporation $643.3 5.0% (14.1%) 14.7x NA $1,211.3 0.59x 6.9x Farmer Brothers Co. $471.2 3.3% 26.6% 29.1x 145.6% $455.1 0.85x 14.7x Lifeway Foods $302.9 0.1% 16.0% 35.6x 222.7% $306.3 2.66x NMF Jones Soda Co. $14.3 (16.7%) (27.1%) NA NA $13.8 1.04x NMF Mean (3.6%) 19.5% 24.1x 194.7% $46,400.5 3.37x 15.4x Median (4.1%) 16.1% 20.6x 182.8% $16,422.9 3.31x 15.3x Note: Data as of December 31, 2014 Sources: FactSet Research Systems, Bloomberg, and Capital IQ; data is sometimes based on reported results and includes estimates
Food For Thought 14 Public Company Trading Statistics
William Blair
Food Retail Companies
($ in millions) % Change Forward Enterprise Value/LTM Enterprise Company Market Cap MTD YTD P/E PEG Value Sales EBITDA The Kroger Co. $31,547.9 7.3% 62.4% 18.2x 202.1% $42,844.9 0.41x 9.1x Whole Foods Market $18,151.7 2.8% (12.8%) 31.9x 178.0% $17,470.7 1.23x 13.2x Safeway $8,095.2 0.8% 7.8% 29.4x 319.4% $9,497.7 0.26x 6.0x Sprouts Farmers Market $5,140.4 6.9% (11.6%) 40.3x NA $5,406.5 1.90x 22.1x United Natural Foods $3,866.4 2.8% 2.6% 29.0x 189.7% $4,396.3 0.65x 16.8x SUPERVALU $2,532.8 3.6% 33.1% 14.5x NA $5,199.8 0.30x 6.5x The Fresh Market $1,995.9 0.6% 1.7% 22.7x 114.4% $2,006.0 1.22x 11.6x Weis Markets $1,286.3 3.7% (9.0%) NA NA $1,191.8 0.43x 7.5x Smart & Final Stores(1) $1,149.5 0.4% 31.1% 21.5x NA $1,629.7 0.49x 10.7x SpartanNash Company $980.1 12.0% 7.7% 13.4x 133.8% $1,529.0 0.21x 7.6x Ingles Markets $751.4 36.7% 36.9% 18.1x 160.1% $1,680.1 0.44x 7.8x Natural Grocers by Vitamin Cottage $633.5 25.3% (33.6%) 43.5x 164.0% $650.3 1.30x 16.6x Village Super Market $384.8 14.0% (11.7%) NA NA $362.2 0.24x 7.0x Roundy's $233.1 20.1% (50.9%) 12.3x 46.2% $843.4 0.20x 6.0x Fairway Group Holdings Corp. $136.9 (15.1%) (82.7%) NMF NA $356.3 0.45x 12.1x Mean 8.1% (4.3%) 24.6x 167.5% $6,337.6 0.65x 10.7x Median 3.7% (3.7%) 22.1x 164.0% $1,680.1 0.44x 9.1x
Convenience Store Companies
($ in millions) % Change Forward Enterprise Value/LTM Enterprise Company Market Cap MTD YTD P/E PEG Value Sales EBITDA Alimentation Couche-Tard $23,990.1 18.5% 67.7% 27.9x NA $25,655.3 0.67x 15.8x Casey's General Stores $3,488.8 7.9% 28.6% 22.5x 202.4% $4,271.1 0.58x 11.3x The Pantry $868.8 39.6% 120.9% 162.8x 1479.6% $1,720.5 0.25x 8.5x Mean 22.0% 72.4% 71.1x 841.0% $10,549.0 0.50x 11.9x Median 18.5% 67.7% 27.9x 841.0% $4,271.1 0.58x 11.3x (1) Company had an initial public offering in 2014 – performance over pricing Note: Data as of December 31, 2014 Sources: FactSet Research Systems, Bloomberg, and Capital IQ; data is sometimes based on reported results and includes estimates
Food For Thought Public Company Trading Statistics 15
William Blair
Same-Store Growth – Food & Convenience Retail
Grocery Stores & Supermarkets
Sprouts Farmers Market 9.0% Smart & Final Stores 6.6%
Kroger(1) 5.6% Publix Super Markets 5.0% Natural Grocers by Vitamin Cottage 3.7% The Fresh Market 3.3% Whole Foods Market 3.1% Weis Markets 2.6%
Safeway(1) 1.8% Village Super Market 1.6% Ingles Markets 0.9% SpartanNash 0.4% SUPERVALU 0.4% Roundy's (2.7%) Fairway Group Holdings (3.9%)
Convenience Stores Casey's General Stores 6.6% Alimentation Couche-Tard 2.8%
The Pantry 2.5% (1) Excludes fuel sales Note: Bolded companies reflect recently announced same-store sales data (announced in December 2014) Note: Data represents growth in the most recent reported fiscal quarter over the year-ago period Sources: Company filings and Capital IQ as of December 31, 2014
Food For Thought 16 Same-Store Growth – Food & Convenience Retail
William Blair
U.S. Public Equity Financing Summary – LTM
IPOs
($ in millions)
At Filing At Pricing Pricing & Performance - % Change Offer/ Initial Shares/ Deal Shares/ Filing Offer ADS Exc. Filing Value at ADS Inc. Offer Deal Market Relative Date Date Ticker Issuer Ovl. Range Midpoint Ovl. Price Value Value to Range 1 Day 1 Month 3 Months Current
$12.00 - 06/20/14 09/23/14 SFS Smart & Final Stores 13.5 175.5 15.5 $12.00 $186.0 $852.7 In Range 4.2% 9.2% 29.2% 31.1% $14.00
Mean 4.2% 9.2% 29.2% 31.1%
Median 4.2% 9.2% 29.2% 31.1%
Follow-Ons
($ in millions)
Pricing Performance - % Change
% Shares Offered Last Trade Before Shares/ Pricing ADS Offered Offer Deal Value Filing/ Offer/ Offer/ Date Ticker Issuer Business Description (mm) Price (mm) Primary Secondary Offer Offer Current
Manufacturer and marketer of convenience 11/17/14 PF Pinnacle Foods 20.0 $32.11 $642.2 0% 100% 4.8% 4.8% 9.9% food products
Specialty retailer of natural and organic 11/10/14 SFM Sprouts Farmers Market 15.0 $29.38 $440.7 0% 100% 7.9% 7.9% 15.7% food
Manufacturer and marketer of natural snack 09/11/14 SNAK Inventure Foods 3.6 $12.85 $46.2 0% 100% (9.7%) (4.6%) (0.9%) food products
Manufacturer and marketer of convenience 09/08/14 PF Pinnacle Foods 15.0 $31.90 $478.5 0% 100% 6.0% 6.0% 10.7% food products
Specialty retailer of natural and organic 08/12/14 SFM Sprouts Farmers Market 15.0 $30.00 $450.0 0% 100% 5.6% 8.5% 13.3% food
Producer and distributor of chicken and 07/30/14 TSN Tyson Foods 23.8 $37.80 $900.0 100% 0% 5.4% 3.6% 12.3% related food products
Manufacturer and distributor of food and 07/16/14 THS Treehouse Foods 4.3 $75.50 $325.0 100% 0% 4.0% 2.2% 13.3% beverage products
Manufacturer and marketer of convenience 05/21/14 POST Post Holdings 5.5 $47.70 $262.4 100% 0% (1.6%) (2.5%) (12.2%) food products
Specialty retailer of natural and organic 03/27/14 SFM Sprouts Farmers Market 15.0 $33.75 $506.3 0% 100% 12.5% 4.5% 0.7% food
Manufacturer and marketer of convenience 03/12/14 POST Post Holdings 5.0 $55.00 $275.0 100% 0% 8.1% (0.1%) (23.8%) food products
Operator of a supermarket chain in the 02/03/14 RNDY Roundy's 8.8 $7.00 $61.9 33% 67% 25.9% 21.1% (30.9%) Midwest
Mean 6.3% 4.7% 0.7%
Median 5.6% 4.5% 9.9%
Sources: Dealogic and FactSet Research Systems Note: LTM as of December 31, 2014
Food For Thought U.S. Public Equity Financing Summary – LTM 17
William Blair
Selected Upcoming Industry Events
Date Event Location
January 2015 11-13 Winter Fancy Food Show San Francisco, CA 12-14 NW Food Manufacturing & Packaging Exposition Portland, OR 14-15 MarcabyBolognaFiere Bologna, Italy 18-20 Retail Industry Leaders Association – The Leadership Forum Amelia Island, FL 24-27 FMI’s Midwinter Executive Conference Miami Beach, FL 27-29 International Production & Processing Expo Atlanta, GA
February 2015 1-6 NAFDMA Convention Nashville, TN 4-6 Convenience Retailing University Dallas, TX 8-11 N.G.A. 2015 Annual Convention and Supermarket Synergy Showcase Las Vegas, NV 15-18 IFA’s Annual International Franchise Convention Las Vegas, NV 16-19 NCA State of the Industry Conference Miami, FL 21-25 AFFI Frozen Food Convention Anaheim, CA 22-24 AMI Foundation Annual Meat Conference Nashville, TN 22-25 RILA Supply Chain Conference Orlando, FL 24-26 Snack, Beverage & Grocery EPPS Jacksonville, FL
March 2015 2-4 FMI Annual Business Conference Chicago, IL 5-8 Natural Products Expo West Anaheim, CA 9-12 FMI Asset Protection Conference Memphis, TN 15-17 Seafood Expo North America & Seafood Processing North America Boston, MA 22-25 Restaurant Leadership Conference Scottsdale, AZ 22-26 NACS Global Forum Singapore 22-26 AFFI Annual Food and Beverage Environmental Conference Point Clear, Ala 28-1 American Bakers Association Annual Convention Orlando, FL
April 2015 12-15 Grocery Manufacturers Association Science Forum National Harbor, MD 14-16 NACS State of the Industry Summit Chicago, IL 15-16 NGA Day in Washington (NGA, FMI and FIAE) Washington, DC
May 2015 3-6 RILA Asset Protection Conference Orlando, FL 3-6 FMI’s 2015 Financial Executive Conference and Internal Auditing Conference (Co-Located) New Orleans, LA 16-19 NRA Restaurant Hotel Motel Show Chicago, IL 18-20 CSP Leadership and Crisis Prevention Forum Denver, CO 19-20 PLMA’s Annual “World of Private-Label” Amsterdam 19-21 NCA Sweets & Snacks Expo Chicago, IL 31-Jun 2 AFFI Food Logistics Forum Incline Village, NV 31-Jun 4 NGA Leadership Development Program (Cornell) Ithaca, NY
Food For Thought 18 Selected Upcoming Industry Events
William Blair
Date Event Location
June 2015 7-9 International Dairy Deli Bakery Association Annual Convention "Dairy-Deli-Bake" Atlanta, GA 7-11 NGA Leadership Development Program (USC) Los Angeles, CA 7-12 Insight NACS Future of Convenience London, UK 8-11 United Fresh 2015 Chicago, IL 9-11 FMI Connect Chicago, IL 22-24 Foodservice at Retail Expo 2015 Nashville, TN 28-29 TRA Marketplace (formerly Southwest Foodservice Expo) Dallas, TX 28-30 NASFT – Summer International Fancy Food & Confection Show New York, NY
July 2015 20-23 NBJ Summit Dana Point, CA 26-28 The International Foods Planning TBD 27-29 Center Store Grocery, Snack & Beverage Planning TBD
August 2015 22-25 NACDS Total Store Expo Denver, CO
September 2015 1-2 Food Evolution Summit Phoenix, AZ 15-18 RILA Retail Sustainability Conference Austin, TX 16-18 NCA Washington Forum Washington D.C 17-19 All Things Organic - BioFach America Baltimore, MD 17-20 Natural Products Expo East Baltimore, MD 20-22 MUFSO Conference Dallas, TX 20-23 Candy Annual Planning Chandler, AZ 28-29 Canadian Federation of Independent Grocers-Grocery Innovations Toronto, Canada
October 2015 10-13 National Frozen and Refrigerated Foods Convention Dallas, TX 11-14 NACS Show Las Vegas, NV 13-15 Shopper Marketing Expo Minneapolis, MN 15-18 PROCESS EXPO Chicago, IL 18-20 Consumer Goods Forum: Future Leaders Congress Rio De Janeiro, Brazil 23-25 Fresh Summit International Convention & Exposition Atlanta, GA 26-27 IFE Americas Food & Beverage Show Miami, FL 28-29 National Chicken Council - Annual Conference Washington, DC
November 2015 10-11 Kosherfest Secaucus, NJ 14-16 Outlook Leadership 2015 (CSP) TBD 15-17 PLMA's Private Label Trade Show Chicago, IL
December 2015 3-6 SOHO Expo Orlando, FL
Food For Thought Selected Upcoming Industry Events 19
William Blair
General Market Update
Percentage Change
As of 12/31/14 Month-to-Date Year-to-Date Equity Market Indices Dow Jones Industrial Average $17,823.07 (0.0%) 7.5% Nasdaq Composite $4,736.06 (1.2%) 13.4% S&P 500 $2,058.90 (0.4%) 11.4% S&P Food Products Index $495.06 (2.1%) 10.1% S&P Food & Staples Retail Index $384.56 2.7% 21.0% S&P Restaurants Index $839.34 (0.7%) 4.3%
WB Corporate Finance Indices(1) Food Index $850.92 0.4% 16.9% Ingredients Index $966.46 2.1% 25.7% Beverage Index $4,171.71 (5.1%) 7.5% Food Retail Index $971.95 4.9% 20.7% Convenience Store Index $26,227.59 19.1% 77.2%
Currencies Dollar to Canadian Dollar $1.16 1.6% 9.0% Dollar to Euro $0.83 3.0% 13.9% Dollar to Peso $14.74 6.0% 12.5% Dollar to Pound $0.64 0.4% 6.2%
Commodities(2) Coffee Beans (Cents and 1/100 of a Cent Up to 2 Decimal Places) $1.67 (11.1%) 50.5% Corn (Cents per Bushel) $3.97 2.1% (5.9%) Milk (Cents per 2,000 lbs.) $0.16 (11.6%) (17.7%) Cocoa (Dollars per Metric Ton) $2,910.00 2.4% 7.4% Oil (Dollars per Barrel) $53.27 (19.5%) (45.9%) Soybean Oil (Cents per Bushel) $0.32 (0.5%) (17.9%) World Sugar (Cents and 1/100 of a Cent up to 2 Decimal Places) $0.15 (6.9%) (11.5%) Wheat (Cents per Bushel) $5.90 1.9% (2.6%)
Yield (%) 52-Week Range
As of 52-Week 52-Week 12/31/14 Low Latest High INTEREST RATES 0.0% 0.5% 1.0% 1.5% 2.0% 2.5% 3.0% 3.5% 4.0% 10-Year Treasury 2.2% 2.1% 3.0% 30-Year Treasury 2.7% 2.7% 3.9% 3-Month LIBOR 0.3% 0.2% 0.3% Fed Funds Effective Rate 0.1% 0.1% 0.1% Prime Rate 3.3% 3.3% 3.3% (1) WB Corporate Finance indices are determined by FactSet Research Systems, as of December 31, 2014. Data is based on a weighted average by market capitalization calculation. (2) Commodities represent futures prices Source: FactSet Research Systems as of December 31, 2014 WB Corporate Finance Food Index includes: ARYZTA, Associated British Foods, B&G Foods, Bridgford Foods, Calavo Growers, Cal-Maine Foods, Campbell Soup, Chiquita Brands International, ConAgra Foods, Danone, Dean Foods, Diamond Foods, Dole Food Company, Flowers Foods, Fresh Del Monte Produce, General Mills, George Weston Limited, Golden Enterprises, Grupo Bimbo, Hormel Foods, Inventure Foods, J&J Snack Foods, JBS, John B Sanfilippo & Son, Kellogg Company, Kraft Foods, Lancaster Colony Corporation, McCormick & Co., Nestlé, Overhill Farms, Pilgrim’s Corp., Post Holdings, Sanderson Farms, Saputo, Seneca Foods, Nestlé, Ralcorp Holdings, Reddy Ice Holdings, Sanderson Farms, Saputo, Sara Lee, Seneca Foods, Smart Balance, Smithfield Foods, Snyder’s-Lance, The Hain Celestial Group, The Hershey Company, The J. M. Smucker Company, Tootsie Roll Industries, Treehouse Foods, Tyson Foods, Unilever WB Corporate Finance Beverage Index includes: Anheuser-Busch InBev, Boston Beer Co., Brown-Forman Corporation, Coca-Cola Bottling Co. Consolidated, Coca-Cola Enterprises, Constellation Brands, Cott Corporation, Diageo, Dr Pepper Snapple Group, Farmer Brothers Co., Green Mountain Coffee Roasters, Jones Soda Co., Lifeway Foods, Molson Coors Brewing Company, Monster Beverage Corporation, National Beverage, PepsiCo, SABMiller, The Coca-Cola Company WB Corporate Finance Ingredients Index includes: Barry Callebaut, Frutarom Industries, Givaudan, International Flavors & Fragrances, Kerry Group, Sensient Technologies Corporation, Symrise, T. Hasegawa Co., Takasago International WB Corporate Finance Food Retail Index includes: Arden Group (Gelson’s), Fairway Group Holdings, Harris Teeter Supermarkets, Ingles Markets, Nash Finch, Roundy’s, Safeway, Smart & Final Stores, Spartan Stores, SUPERVALU, The Fresh Market, The Kroger Co., United Natural Foods, Village Super Market, Vitamin Cottage Natural Food Markets, Weis Markets, Whole Foods Market WB Corporate Finance Convenience Store Index includes: Alimentation Couche-Tard, Casey’s General Stores, Pantry
Food For Thought 20 General Market Update
Quarterly Market Update – All Industries
William Blair
Domestic M&A Market Summary
U.S. Activity Trends
M&A Activity
Number of Deals Undisclosed Middle Market >$750M Deal Value Deal Value ($ in billions) 13,340 14,643 18,000 12,420 11,488 12,749 13,397 12,198 12,713 $1,800 8,792 9,934 10,087 9,375 12,000 $1,200 6,000 $600
0 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Number of Deals >$750M 147 233 281 362 460 228 156 287 262 301 310 372 Mid-Cap 4,239 4,527 4,453 4,548 4,537 4,766 4,144 6,224 5,360 5,153 4,258 3,880 Undisclosed 4,406 5,174 5,353 7,510 8,343 6,494 5,075 6,238 7,775 9,189 7,630 8,461 Deal Value $688 $992 $1,297 $1,647 $1,750 $1,075 $886 $1,048 $1,174 $1,080 $1,242 $1,806
Mid-Cap M&A Activity
Deal Value Number of Deals <$50M $50-250M $250 -750M Deal Value ($ in millions) 4,537 10,000 4,766 6,224 $600 4,548 4,144 5,360 5,153 4,258 3,880 4,239 4,527 4,453 $400 $200
0 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Number of Deals
$250M-$750M 314 402 424 536 627 417 269 457 475 463 523 504 $50M-$250M 1,065 1,218 1,265 1,294 1,333 1,195 791 1,138 1,148 1,148 1,094 1,137 <$50M 2,860 2,907 2,764 2,718 2,577 3,154 3,084 4,629 3,737 3,542 2,641 2,239 Deal Value $292 $351 $364 $421 $466 $355 $239 $370 $383 $378 $386 $381
Private-Equity Activity
Number of Deals Undisclosed Middle Market >$750M Deal Value Deal Value ($ in billions) 5,000 $800 2,247 2,164 2,156 1,646 1,812 1,821 1,976 2,035 1,888 1,200 2,316 1,462 $400
0 $0 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Number of Deals >$750M 33 61 84 106 149 64 34 94 88 92 93 115 Mid-Cap 626 906 859 998 826 788 742 869 698 688 557 534 Undisclosed 541 679 869 1,143 1,341 969 686 1,013 1,249 1,384 1,238 1,507 Deal Value $120.4 $224.6 $287.6 $523.7 $644.3 $243.7 $149.3 $272.3 $268.6 $262.1 $307.5 $382.5 Note: Year-to-date as of December 31, 2014 Sources: Dealogic and William Blair’s mergers-and-acquisitions market analysis. Data represents announced deals only
Food For Thought Domestic M&A Market Summary 21
William Blair
U.S. Valuation Trends
Median EV/EBITDA Multiples
Middle Market Overall Market
15.0x 12.0x 9.0x 6.0x
3.0x 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Mid-Cap 7.5x 7.4x 8.7x 10.1x 10.0x 9.5x 7.9x 6.4x 9.3x 10.0x 9.1x 9.9x 10.2x
Overall Market 7.9x 8.0x 9.1x 10.3x 11.0x 11.2x 9.0x 7.4x 9.9x 10.8x 9.6x 10.0x 11.2x
Median EV/EBITDA Mid-Cap Multiples
< $50M $50M-$250M $250M-$750M 16.0x
12.0x
8.0x
4.0x
0.0x 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 < $50M 4.1x 7.1x 6.4x 7.2x 10.2x 7.8x 4.9x 3.9x 8.8x 9.0x 6.8x 8.1x 7.7x $50M-$250M 7.5x 6.9x 8.7x 11.3x 9.5x 10.4x 9.1x 7.1x 9.3x 10.0x 9.2x 11.3x 10.1x $250M-$750M 9.7x 9.2x 9.1x 10.0x 11.0x 9.4x 8.3x 7.9x 9.7x 10.7x 10.2x 12.9x 10.5x
Average Acquisition Premiums
1-Week Premium 4-Week Premium
50%
40%
30%
20% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 1-Week Premium 36% 32% 28% 26% 26% 27% 36% 38% 34% 36% 36% 23% 31% 4-Week Premium 38% 40% 32% 31% 31% 29% 37% 41% 38% 39% 39% 30% 34% Notes: Data limited to a range of 1 to 100 and LTM is as of December 31, 2014 Sources: Dealogic and William Blair’s mergers-and-acquisitions market analysis. Data represents announced deals only
Food For Thought 22 Domestic M&A Market Summary
William Blair
U.S. Equity Capital Markets Summary
Historical IPO Issuance
243 250
200 175 139 150 95 105 100 63 70 54 50 48 56 54 56 28 35 39 50 13 19 25 20 21 21 0 2009 2010 2011 2012 2013 2014 1Q 11 2Q 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14
Historical Follow-On Issuance
657 700 612 564 600 506 470 500 399 400 300 193 198 183 152 173 200 135 128 130 127 139 120 86 98 115 111 100 50 0 2009 2010 2011 2012 2013 2014 1Q 11 2Q 11 Q3 11 Q4 11 Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14
Note: Excludes follow-on offerings for CLEFs, REITs, and SPACs
IPO Pricings by Sector – Last 4 Quarters: Follow-on Pricings by Sector – Last 4 Quarters:
243 Total Deals 694 Total Deals
11 60 16 Business Services 107 Business Services 59 48 31 Consumer Consumer 58 Financial Financial
26 Healthcare Healthcare 177 Industrial Industrial 162 100 Technology Technology
Sources: Dealogic and William Blair’s mergers-and-acquisitions market analysis
Food For Thought Domestic M&A Market Summary 23
William Blair
Debt Capital Markets Summary
Average Equity Contribution
Less than $50 million EBITDA More than $50 million EBITDA 50% 47% 46% 46% 45% 41% 43% 41% 40% 40% 41% 38% 38% 40% 40% 36% 37% 35% 37% 37% 36% 34% 33% 31% 32% 32% 32% 30% 29% 30% 30%
20%
10%
0% 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Quarterly LBO Debt Multiples – Less Than $50 Million EBITDA
Total Debt/EBITDA Senior Debt/EBITDA 7.0x 7.0x 7.0x 6.0x 4.8x 6.0x 6.0x5.1x 4.2x 4.9x 5.0x 4.0x 4.9x 4.8x 4.4x 5.0x 5.1x 5.0x 4.4x 5.0x 4.2x 4.2x 3.8x 5.0x 4.2x 4.4x 3.8x 4.4x 3.8x 3.7x 4.0x 3.4x 5.1x 5.1x 3.6x 3.8x 4.8x 5.0x 4.0x 3.6x 3.7x 4.5x 4.8x 5.0x 4.0x 4.5x 3.4x 4.0x 4.0x 4.0x 3.8x 3.8x3.8x 3.0x 3.0x 3.7x 3.7x 3.7x 3.0x 3.8x 3.3x3.3x 3.7x 3.2x 3.2x 3.0x 3.1x3.1x 3.0x 2.2x 2.2x 2.0x 2.0x 2.0x 2001 20012002 20022003 20032004 20042005 2005 20062006 20072007 20082008 20092009 20102010 20112011 2012 20122013 20132014 2014
Quarterly LBO Debt Multiples – Greater Than $50 Million EBITDA
7.0x 6.8x 7.0x 5.5x 6.6x 6.0x 5.3x 6.0x 5.1x 4.8x 4.9x 5.7x 5.3x 5.0x 4.5x 5.0x 4.8x 4.3x 5.0x 4.1x 4.4x 5.5x 4.0x 4.9x 4.0x 4.0x 4.4x 3.1x 3.9x 4.0x 2.6x 3.0x 3.5x 3.0x 3.1x 2.9x 2.6x 2.9x 2.0x 2.0x 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Sources: Dealogic and Standard & Poor’s as of December 31, 2014
Food For Thought 24 Debt Capital Markets Summary
William Blair
William Blair Food & Beverage and Food Convenience & Retail Investment Banking
Food & Beverage Production Jim Bertram is the global head of the firm’s consumer and retail investment banking group. Before joining William Blair in 2006, he was the co-head of Banc of America Securities’ global consumer products investment banking practice. In this role, he assisted domestic and international consumer products manufacturers and distributors in executing mergers and acquisitions and raising debt and equity capital through both public and private market transactions. Before joining Banc of America Securities, he was responsible for leading Deutsche Bank Alex. Brown’s food-and-beverage investment banking activity. Before working at Deutsche Bank Alex. Brown, he was vice president in the corporate finance department at George K. Baum & Company, an investment and merchant banking firm where he advised clients in executing public equity offerings, mergers and acquisitions, and private debt placements. Mr. Bertram began his career in investment banking at Salomon Brothers. Mr. Bertram graduated with highest honors from the University of Illinois with a B.S. in finance. [email protected] +1 312 364 5426 Brent Smith is a managing director in the consumer and retail group. Since joining William Blair in 2000, Mr. Smith has also been a member of the firm’s mergers-and-acquisitions practice and currently heads William Blair’s consumer M&A effort. Over this period, he has worked on a range of public and private M&A, primarily in the consumer and industrial sectors, totaling more than $18 billion in aggregate transaction value. Mr. Smith’s financial advisory experience includes sell-side and buy-side transactions, corporate divestitures, take-private transactions, strategic options studies, valuations, fairness opinions, and special committee situations. Mr. Smith is a member of William Blair’s Fairness Opinion Committee. Before joining William Blair, Mr. Smith worked at both Lehman Brothers and Heitman Financial. Mr. Smith holds an M.B.A. with honors from the University of Chicago and a B.B.A. with high distinction from the University of Michigan. [email protected] +1 312 364 5392 Adam Filkin joined William Blair in 2007 and is a managing director in the consumer and retail investment banking group. Mr. Filkin has extensive transaction experience across numerous consumer verticals, including food, consumer products, and personal care. He joined William Blair from Banc of America Securities, the investment banking arm of Bank of America. Mr. Filkin spent three years at Banc of America, serving as an associate in the consumer and retail practice. Before joining Banc of America, Mr. Filkin was a manager at A.T. Kearney, focusing on growth strategies and operational improvement studies for consumer and retail companies. He has more than 10 years of experience working with consumer and retail companies. Mr. Filkin holds an M.B.A. with a concentration in finance from the University of Chicago and holds a B.S.E. in chemical engineering from the University of Michigan. [email protected] +1 312 364 8077
Food For Thought William Blair Food & Beverage and Food Convenience & Retail Investment Banking 25
William Blair
Food & Convenience Retail Tim Carroll joined William Blair in 2002 and serves as a managing director in the consumer and retail investment banking group. He joined William Blair from Andersen Corporate Finance LLC, the investment banking arm of Andersen. Mr. Carroll spent four years at Andersen, serving as a national director and managing director/co-head of the products and business services industry team. Before joining Andersen, he was a founder and principal of Wyndam Capital, a broker-dealer serving middle-market companies, and a founder and principal of a $120 million private-equity fund. Mr. Carroll has served on the board of directors for seven privately held businesses and has more than 27 years of investment banking experience, 7 years of commercial banking experience, and 2 years of commercial real estate experience. Mr. Carroll graduated with a B.S. in business finance from Indiana University. [email protected] +1 312 364 8532 Michael Siska is a managing director in the consumer and retail investment banking group at William Blair. He originally joined the firm in 2002 and then rejoined in 2006 after attaining his M.B.A. at the University of Chicago. Before joining William Blair, Mr. Siska worked in private equity for Allstate Private Equity in Chicago and 3i Group in London. He also spent five years in the products and business services industry group at Andersen Corporate Finance LLC, the investment banking arm of Andersen. He focuses on specialty retail, food retail, restaurants, and consumer services. Mr. Siska earned an M.B.A. from the University of Chicago and a B.S., with honors, from the University of Illinois at Urbana-Champaign. [email protected] +1 312 364 5393
Europe Alex Matthes is a managing director at William Blair. Before he joined William Blair in 2013, Mr. Matthes worked in Commerzbank’s M&A advisory team with a focus on consumer and retail. Before joining Dresdner Kleinwort in 2006 as vice president, he worked in the M&A department of Lazard as analyst and associate since 2000. Mr. Matthes studied business administration at the universities of Frankfurt and Cologne and obtained a master’s degree in business administration (Diplom Kaufmann) in 2000. [email protected] +49 69 509527 612 Beth Pickens is a managing director and head of European consumer banking. She joined William Blair in 2000 and has been located in William Blair’s London office since 2001. Ms. Pickens specializes in advising international consumer growth companies across consumer products, personal care, and consumer services. She is also an angel investor in early-stage consumer companies, including Bonobos.com and DefySupply.com. Ms. Pickens holds a master’s degree in business administration from the University of Chicago Graduate School of Business and a bachelor’s degree in finance from the University of Illinois at Urbana-Champaign. She also completed studies at the Université de Paris IV-Sorbonne. A Chicago native, she lives in London with her husband and children. [email protected] +44 20 7868 4479
Food For Thought 26 William Blair Food & Beverage and Food Convenience & Retail Investment Banking
William Blair
Recent William Blair Consumer & Retail Transactions
Not Disclosed Not Disclosed Not Disclosed Not Disclosed Not Disclosed
has acquired has been acquired by has been acquired by has been acquired by has been acquired by Robert Bosch Tool One Rock Capital Knowlton Development Frutarom Wasserstein & Co., LP Corporation, Garden & Partners Corporation Watering Business Industries Ltd. December 2014 December 2014 December 2014 December 2014 November 2014
€220,000,000 $186,300,000 $139,840,000 $105,000,000 $128,000,000
has been acquired by has been acquired by
Abris Capital Partners Follow-on Offering Follow-on Offering Follow-on Offering Post Holdings, Inc.
November 2014 November 2014 November 2014 November 2014 November 2014
Not Disclosed Not Disclosed $108,235,280 $85,000,000 $53,117,980
has been acquired by Growth Equity Monomoy Capital Initial Public Offering Senior Credit Facility Follow-on Offering Recapitalization Partners October 2014 October 2014 October 2014 September 2014 September 2014
Not Disclosed $156,543,750 Not Disclosed $123,214,290 $89,125,000
has a strategic investment from has been acquired by Standard Chartered Peet’s Coffee & Tea / Follow-on Offering Initial Public Offering Follow-on Offering Private Equity Next World Capital August 2014 August 2014 August 2014 July 2014 July 2014
$373,749,990 $171,646,263 $202,000,000 CAD$170,000,000 Not Disclosed
has been acquired by has been acquired by has been acquired by
Follow-on Offering Follow-on Offering Snyder’s Lance TreeHouse Foods, Inc. Milner Milling, Inc.
July 2014 June 2014 June 2014 May 2014 May 2014
$64,166,663 $132,050,000 $100,624,980 $61,300,000 Not Disclosed
has been acquired by has been acquired by The Hain Initial Public Offering Initial Public Offering Initial Public Offering Bregal Partners Celestial Group May 2014 April 2014 April 2014 April 2014 March 2014
Not Disclosed Not Disclosed Not Disclosed $51,500,000 $290,950,000
has divested Mervin has been acquired by has been acquired by has been recapitalized by Manufacturing Inc. to ADKM, Inc. Altamont Capital Greencore Group TZP Group Initial Public Offering (DBA Harry's) Partners February 2014 January 2014 December 2013 November 2013 November 2013
Food For Thought Recent William Blair Consumer & Retail Transactions 27
William Blair
William Blair Consumer & Retail Coverage
Mark Miller, CFA +1 312 364 8498 Sharon Zackfia, CFA +1 312 364 5386 Broad Assortment and Hardlines, Apparel and Accessories, Leisure, Restaurants E-commerce, Health, Beauty, and Convenience Company Ticker Company Ticker Amazon.com AMZN BJ’s Restaurants BJRI Blue Nile NILE Bloomin’ Brands BLMN Cabela’s CAB CarMax KMX Costco Wholesale Corporation COST Carnival Corporation CCL CVS Health Corporation CVS Cheesecake Factory (The) CAKE Dick’s Sporting Goods DKS Chipotle Mexican Grill CMG Fairway Group Holdings FWM Dunkin’ Brands Group DNKN Fresh Market (The) TFM El Pollo Loco Holdings LOCO GNC Holdings GNC Harley-Davidson HOG JD.com JD Life Time Fitness LTM MercadoLibre MELI Lululemon Athletica LULU Natural Grocers by Vitamin Cottage NGVC Panera Bread Company PNRA Sportsman’s Warehouse Holdings SPWH Papa Murphy’s Holdings FRSH Target Corporation TGT Potbelly PBPB Tractor Supply Company TSCO Royal Caribbean Cruises RCL Vitamin Shoppe VSI Sonic Corp. SONC Walgreens Boots Alliance WBA Starbucks Corporation SBUX Wal-Mart Stores WMT Tilly’s TLYS Wayfair Inc. W Tumi Holdings TUMI Whole Foods Market WFM Under Armour UA Zulily ZU Urban Outfitters URBN Zoe’s Kitchen ZOES Zumiez ZUMZ Jon Andersen, CFA +1 312 364 8697 Daniel Hofkin, Analyst +1 312 364 8965 Consumer Products Hardlines, Specialty Retail AptarGroup ATR Advance Auto Parts AAP Boulder Brands BDBD AutoZone AZO Church & Dwight CHD Bed Bath & Beyond BBBY Colgate-Palmolive Company CL Luxottica Group LUX Scotts Miracle-Gro Company (The) SMG Mattress Firm Holding Corp. MFRM Fox Factory Holding Corp. FOXF O’Reilly Automotive ORLY Inventure Foods SNAK PetSmart PETM J&J Snack Foods JJSF Regis Corporation RGS J.M. Smucker Company (The) SJM Restoration Hardware Holdings RH Jarden Corporation JAH Ross Stores ROST Kellogg Company K Steiner Leisure STNR Keurig Green Mountain GMCR TJX Companies (The) TJX Mead Johnson Nutrition Company MJN Ulta Salon, Cosmetics & Fragrance ULTA Perrigo Company PRGO Williams-Sonoma WSM Prestige Brands Holdings PBH Procter & Gamble Company (The) PG SodaStream International SODA Tempur Sealy International TPX TreeHouse Foods THS
Amy Noblin, Analyst +1 415 248 2874 Apparel and Accessories Abercrombie & Fitch ANF Nordstrom JWN Coach COH Tiffany & Co. TIF DSW DSW Tumi Holdings TUMI Francesca’s Holdings FRAN Vera Bradley VRA Michael Kors Holdings KORS Vince Holding Corp. VNCE
Food For Thought 28 William Blair Consumer & Retail Coverage
William Blair
Notes
Food For Thought Notes 29
William Blair
Disclosures
William Blair is a trade name for William Blair & Company, L.L.C. and William Blair International, Limited. William Blair & Company, L.L.C., is a Delaware company and is regulated by the Securities and Exchange Commission, The Financial Industry Regulatory Authority, and other principal exchanges. William Blair International Limited is authorised and regulated by the Financial Services Authority ("FSA") in the United Kingdom. William Blair & Company® only offers products and services where it is permitted to do so. Some of these products and services are only offered to persons or institutions situated within the United States and are not offered to persons or institutions outside of the United States. This material has been approved for distribution in the United Kingdom by William Blair International Limited, and is directed only at, professional clients and eligible counterparties (as defined in COBS 3.5 and 3.6 of the FSA Handbook). This advertisement is not intended to be investment advice. William Blair & Company | 222 West Adams Street | Chicago, Illinois 60606 | +1 312 236 1600 | williamblair.com January 29, 2015 Food For Thought 30 Disclosures
William Blair’s investment banking group combines signi icant transaction experience, rich industry knowledge, and deep relationships to deliver successful advisory and inancing solutions to our global base of corporate clients. We serve both publicly traded and privately held companies, executing mergers and acquisitions, growth inancing, inancial restructuring, and general advisory projects. This comprehensive suite of services allows us to be a long-term partner to our clients as they grow and evolve. From 2010-2014, the investment banking group completed more than 330 merger-and- acquisition transactions worth $73 billion in value, involving parties in 36 countries and About William Blair ive continents, was an underwriter on more than 20% of all U.S. initial public offerings, Investment Banking and raised nearly $100 billion in public and private inancing.