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Industry Focus Consumer & retail
SECTOR SPOTLIGHT FOODSERVICE
www.clairfield.com
1 CONTENTS
. RECENT CASE STUDY p. 3 . INTRODUCTION TO FOODSERVICE p. 5 . CLAIRFIELD INTERNATIONAL SECTOR EXPERTISE p. 8 . KEY FACTS ABOUT FOODSERVICE PER REGION . BENELUX p. 11 . BRAZIL p. 15 . DACH p. 18 . FRANCE p. 21 . ITALY p. 25 . NORDICS p. 28 . POLAND p. 31 . SPAIN p. 34 . UK p. 37 . USA p. 40 . CONTACT INFORMATION p. 43 . ABOUT CLAIRFIELD p. 44
2 SECTOR SPOTLIGHT: FOODSERVICE
ADVISOR OF CHOICE FOR CORPORATE CLIENTS (1/2)
3 SECTOR SPOTLIGHT: FOODSERVICE
ADVISOR OF CHOICE FOR CORPORATE CLIENTS (2/2)
CLAIRFIELD ADVISED BIDCORP (FORMERLY BIDVEST) ON 2ND PLATFORM ACQUISITION IN EUROPE
The acquisition of Pier 7 represents the second transaction that Clairfield
International has advised for Bidcorp. In 2014, Clairfield International advised on Bidcorp’s Italian market entry with the acquisition of Gruppo DAC. Clairfield is acquired a majority pleased to be repeatedly selected as the trusted strategic and financial advisor to shareholding in international clients such as Bidcorp.
Deal team: Albert Schander, Oliver Kolb
Advisor to the buyer
Transaction summary Transaction rationale
Bid Corporation (Bidcorp) of South Africa acquired a The acquisition of Pier 7 Foods accomplishes Bidcorp’s majority shareholding in Pier 7 Foods, based in Gröbenzell, objective of market entry into Germany. Pier 7 customers Germany, securing entry into the lucrative German food include well-known restaurant chains and hotels. Bidcorp service market. The transaction was approved by the and Pier 7 Foods will assess other strategic partnering German Bundeskartellamt (Independent Competition opportunities in the upcoming months. The investment in Authority) in July 2017. Pier7 Foods in Germany is a further milestone in Bidcorp’s growth strategy in Europe and comes on the heels of its acquisition of the Spanish Guzman Group. Profile of the companies
Bidcorp Ltd is headquartered in Johannesburg and was established in 1988. The group operates globally in food services which comprises wholesale distribution of frozen, chilled, fresh, and dry foodstuffs, as well as ancillary products, mostly to B2B clients in the HoReCa market (hotels, restaurants, and catering- businesses). Bidcorp is quoted on the Johannesburg stock exchange and generates close to EUR 10 billion in revenues. The group has significant investments in over 50 businesses and currently has approximately 25,000 employees.
Pier 7 Foods Import GmbH was founded in 1998 and headquartered in Gröbenzell, near Munich. The company distributes fresh and frozen food to the food and gastro-hotel industry in Germany and Austria and has long-standing relationships with carefully selected suppliers. Pier 7 has seven subsidiaries with its own logistics and vehicle fleet supplying certain areas and works with its cooperation partners coming from all over Europe. As estimated for 2016, the group generates over EUR 80 million in revenues.
Views of the parties
Markus Erhart, managing director and founder as well as future co- Stephen Bender, managing director of BidCorp shareholder said: "I have been in touch with several business units Foodservice (Europe) Ltd. and future co- of BidCorp over an extended period in order to be certain that I managing director said: “Our investment in Pier have correctly selected my partner, as I intend to proactively 7 Foods in Germany is a further achievement in manage the transition of succession in my business. BidCorp is the our growth strategy in Europe. We are looking right partner for our group for further growth as Bidcorp is very forward to implementation of our roll-out entrepreneurial and our product portfolios complement each strategy for the German market working closely other cross-border. For both sides service to our clients and high with Markus and his team.“ quality are paramount.“
4 SECTOR SPOTLIGHT: FOODSERVICE
INTRODUCTION TO FOODSERVICE
Foodservice worldwide Foodservice markets by sales volume (1)
. Foodservice, defined as the industry serving food outside the home (HoReCa), as well as the service providers – food wholesalers, logistics providers and the like – that cater to the HoReCa industry, is a thriving sector everywhere in the world. . Currently Asia Pacific is the world’s leading foodservice market, accounting for 43% of the market share, driven by rising demand in India and China. . Europe is the third largest foodservice market with France, Germany, Italy, the UK, and Spain as major foodservice submarkets. . Borders between the different market segments < USD 50 bn > USD 1 tn are becoming increasingly blurred. Traditional HoReCa suppliers are increasingly challenged by The total foodservice sales value worldwide is Cash & Carry players and Logistics & Transport estimated at USD 3.4 trillion growing at 4.6% p.a. in segments. 2016 and 2017 (est. CAGR 2015-20 is 3.4%), and the industry is estimated to employ 10.8 million people (many on a part-time basis).
Foodservice industry trends
. According to a study of 10 European countries, . The digital economy is transforming the industry people eat 18% of all meals outside the home. with e-commerce platforms, delivery and This tendency translates into growing automation technologies, and customer-tracking opportunities for producers, distributors, systems. restaurant chains, catering establishments, and . Rising wages mean increased labor costs, which is other foodservice companies. a concern in the industry, though a more . Some trends, such as concern for healthy eating, prosperous workforce also creates more and interest in eating local, fresh, and sustainable consumers. foods, can be tracked throughout the world, . High competition as well as economies of scale however, some trends are more country-specific are very noticeable in the industry, which is one of reflecting the eating habits in the region. the reasons for consolidation in the industry. . The farm-to-table tendency is observed among all . More than ever, foodservice companies and final sector players, from supermarkets to Michelin- customers are expecting wholesalers to provide starred restaurants. Interest in international them with quality products. cuisine is another noteworthy trend affecting all
cultures.
Sources: Tradedimensions GV-Markt 2016; Bulwiengesa Market Study; Genios Food Service; Euromonitor International; Daedal Research: Global Foodservice Market; GIRA Foodservice: Foodservice EUROPE 2018 5 SECTOR SPOTLIGHT: FOODSERVICE
FOODSERVICE IN NUMBERS
188 Number of worldwide deals MARKET made in the foodservice DRIVER 36.4% increase in industry in 2017 Innovation & deal value from customization 2016 to 2017 of food menus
Sample of leading Foodservice companies worldwide: total sales players by offered products, 2016 Market Dairy & trends Others Frozen 20% Desserts 20%
Fruits & MARKET Vegetables CHALLENGE 12% Bakery Fluctuations in commodity 6% Meat, Fish prices & rise & Seafood Beverages 35% in labor costs 6%
Largest foodservice markets Foodservice industry worldwide by end customers, 2016 Schools, Universities Asia North New Markets Europe (Event 5% Pacific America Catering) 10%
Retirement Homes 12% Company Restaurants 55%
€24 billion Hospitals 18% ANNUAL TURNOVER OF THE CONTRACT CATERING INDUSTRY IN EUROPE
Source: Comprises M&A deals in the foodservice industry based on Mergermarket classification; Daedal Research: Global Foodservice Market; PR Newswire Association: Global Foodservice Market 2017-2021; Tradedimensions GV-Markt 2016; Gain Report: Foodservice 2017 6 SECTOR SPOTLIGHT: FOODSERVICE
FOODSERVICE MERGERS & ACQUSITIONS
M&A deals in foodservice worldwide (2013 – 2017)
Deals value and volume Deals by acquiror type EUR bn # 40 250 210 35 198 195 188 Strategic 200 Financial 30 172 69% 31% 25 150 20 35.6 15 100 25.6 26.1 10 21.8 16.2 50 5
0 0 2013 2014 2015 2016 2017 Deal Value Deal Volume Note: Comprises M&A deals in the foodservice industry based on Mergermarket classification; Not all companies disclose a deal value; Up to 31.12.2017
Selected recent M&A deals in foodservice & valuation multiples Announ. Target Acquiror DV Revenue EBITDA EBITDA Target Acquiror Date country country (EUR m) Multiple Multiple Margin 09/2017 Mila S.A. PL Eurocash S.A. PL 82 0.2x 74.3x 0.3% 07/2017 Stonyfield Farm, Inc. US Groupe Lactalis S.A. FR 768 2.4x 20.0x 5.4% 03/2017 KFC (16 establishments) NL Collins Foods Limited AU 62 1.3x 8.5x 15.7% 02/2017 Zabka Polska sp. z o.o. PL CVC Capital Partners Limited UK 1 296 2.6x 43.2x 6.0% 01/2017 Booker Group PLC UK Tesco PLC UK 4,175 0.7x 20.0x 3.6% Charoen Pokphand Foods 12/2016 SuperDrob S.A. (33% stake) PL TH 50 1.1x N.A. N.A. Public Company Ltd 11/2016 Autogrill Nederland BV NL Gr8 Investments BV NL 23 0.7x 8.1x 8.5% 10/2016 Dakri Dystrybucja sp. z.o.o. PL Bake & Co., N.V. BE 6 0.4x 5.0x 7.4% Abris Capital Partners and 08/2016 Graal S.A. (55.77% stake) PL PL 51 0.3x 5.8x 5.7% private investor Organic Farma Zdrowia S.A. 07/2016 PL EcorNaturaSi S.p.A IT 9 1.4x 17.5x 4.2% (63% stake) 07/2016 Internatural AB SE Midsona AB SE 86 1.3x 12.5x N.A. 04/2016 DE.AL. s.r.l. IT Marr S.p.A IT 36 0.6x N.A. N.A. 02/2016 Brake Bros Limited UK Sysco Corporation US 2,786 0.7x 19.0x 3.4% 12/2015 Hortigil Hortifruti S.A. BR Partners Group Holding AG CH 69 0.5x N.A. N.A. 12/2015 Vermaat Groep BV NL Partners Group Holding AG CH 390 3.5x N.A. N.A. 11/2015 Findus Sverige AB SE Nomad Foods Limited BVI 701 1.2x 10.6x 11.0% TowerBrook Capital Partners 03/2015 Ad van Geloven BV NL US 264 1.4x N.A. N.A. LP 02/2015 Drogheria & Alimentari Spa IT McCormick & Company Inc. US 85 1.4x 10.6x 13.3%
Mean 567 1.2x 19.6x 7.0% Median 82 1.2x 12.5x 5.9%
Source: Clairfield Analysis of Mergermarket Data; “DV” = Deal Value; Note: not all deals include public deal values 7 CLAIRFIELD INTERNATIONAL SECTOR EXPERTISE
CONSUMER & RETAIL
8 SECTOR SPOTLIGHT: FOODSERVICE
RELEVANT SECTOR EXPERIENCE
Selected foodservice transactions
South Africa/Germany Germany Norway/ Finland Australia France
CENTRE FRANCE DEVELOPPEMENT acquired a majority acquired the was sold to was sold to sold stake of seafood division of
REPEAT CLIENT South Africa/Italy UK Italy Australia Norway
acquired a majority was sold to was sold to was sold to stake of acquired Qua.Ser
Selected industry contacts
9 SECTOR SPOTLIGHT: FOODSERVICE
CLAIRFIELD INTERNATIONAL SECTOR EXPERTISE
Consumer & retail expertise . Clairfield International provides advisory services, . Clairfield International’s consumer goods sector mainly in cross-border mergers and acquisitions, to team focuses on advisory to midcap clients, multinational corporations, family-owned whether advising on a growth strategy or on enterprises, and private equity firms. Our focus is selling a business the middle-market segment, designing and executing transactions of up to EUR 500 million in enterprise value EUR 9 bn
CUMULATIVE VALUE OF 194 CONSUMER & RETAIL Buy-side Financial CONSUMER & RETAIL TRANSACTIONS Strategic 35% buyers TRANSACTIONS CLOSED SINCE 2006 Sell-side buyers 44% CLOSED SINCE 2006 65% 56%
. Clairfield’s Consumer goods team is chaired by . High ratio of senior partners and directors to junior Albert Schander of Clairfield Germany and Gary employees ensures that senior team members take Ecob of Clairfield United Kingdom. The team an active role in all transactions offers particular expertise in the following areas: . Worldwide presence guarantees our clients direct access to the local knowledge of its regional office . Agribusiness . e-commerce and industry expertise from professionals around . Branded products . Foodservice the globe . Clothing retail . Seafood
Our locations
20+ 400+ COUNTRIES Amsterdam Lyon WHERE CLAIRFIELD Antwerp Madrid PROFESSIONALS IS PRESENT Atlanta Marseille Barcelona Milan Birmingham Moscow Brussels Nantes Budapest Oslo Copenhagen Paris Montreal Dusseldorf Stockholm Frankfurt Stuttgart New York Geneva Tel Aviv Atlanta Washington Helsinki Vienna Miami Istanbul Warsaw Mexico City 35+ London Hong Kong OFFICES
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10 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN BENELUX
11 SECTOR SPOTLIGHT: FOODSERVICE
FOODSERVICE INDUSTRY IN BELGIUM
Current market situation . In 2016, Belgian total sales value of the . Food chains remain underrepresented, but are foodservice/out of home industry was estimated doing better than independent restaurants. at EUR 16.5 billion. The foodservice industry is International players remain absent due to composed of the Horeca industry as well as the various factors such as high taxes and Belgian wholesalers supplying to the HoReCa industry. loyalty to traditional gastronomy. . The FSR channel (full service restaurant), the . Some new market-shaping trends include the largest foodservice channel, accounts for 36% of growing importance of gourmet fast food players the foodservice industry. During the 2014-2016 including purveyors of gourmet burgers and period it grew at a CAGR of 3.4% and is forecast to premium pizzas as well as the increasing demand grow at a CAGR of 3.8% during the 2016-2021 towards subscription fresh food boxes such as period. Hello Fresh or Simply you, the newly introduced . The QSR channel (Quick Service Restaurants) equivalent by Carrefour. accounts for 8% of total revenue generated and . Margins are under pressure in the food service has grown at a CAGR of 3.0% between 2014 and industry due to the high energy costs (affecting 2016 and is forecast to grow at a CAGR of 3.2% mainly the smaller businesses) but more during 2016-2021. importantly because labor costs are more than . While the FSR market is highly fragmented, about 20% higher than in neighboring countries France, a third of the QSR market generates 56.4% of the Germany, and the Netherlands. channel revenue (with Panos, subsidiary of La Lorraine Bakery Group, being the largest QSR operator). Although just 31% of QSR outlets are Consumption evolution in the Belgian owned by chain operators, they generate 56% of the channel revenue. Panos is the largest QSR HoReCa sector operator by a substantial margin, representing 18% of the channel’s value. Evolution number of visits 2.8% 2.3% 1.0% 0.5% 0.5%0.8% 0.0% Top market players in Belgium
Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Total -0.8%- 1.2% EBITDA -1.7% -1.6% -2.5% Belgium Belgium -1.9% -1.8% -3.5% Company 2016 -4.9% -4.6% sales 2016 employees 2011 2012 2013 2014 2015 (EUR m) -5.9% (EUR m) -6.2%
883.2 4.6 399
367.0 N.A. +1,000 Evolution spending per visit 1.4% 1.2% 319.3 5.6 403.3 0.7% 1.0% 0.6% 0.5% 0.4% 0.4% 0.4% 165.8 4.4 161.3 0.2% 0.2% 0.1% 0.0% 0.0%
157.5 6.4 206 -0.1% Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 -0.4% -0.5%-0.5% -0.8% 2011 2012 2013 2014 2015
Source: Euromonitor (2017); Business Insider (2017); Market Monitor; National Bank of Belgium (2017) 12 SECTOR SPOTLIGHT: FOODSERVICE
FOODSERVICE INDUSTRY IN THE NETHERLANDS
Current market situation . The Dutch foodservice / out of home market . Hotels, restaurants and quick service restaurants generated sales of EUR 18.3 billion (based on (QSRs) are showing steady volume growth due to food, beverage, and tobacco spending) in 2016, increasing consumer confidence and increasing showing positive 2.7% year-on-year growth. number of tourists. On-the-go service concepts . All top five players (see table below) are active as are also gaining popularity due to larger mobility foodservice wholesalers. The wholesale market is and less fixed working hours. highly concentrated and characterized by . The catering workforce is decreasing and consolidation and scale up, where approximately increasingly becoming characterized by flexible 80% of the market belongs to the top ten players. labor. In contrast, catering revenues are In contrast, the market with companies serving increasing due to much higher pricing (50% the out-of-home end consumer like hotels, increase during 2006-2016 compared to inflation restaurant and caterers is still highly dispersed. of only 17%).
Top market players in the Netherlands
Total Dutch sales 2016 Dutch wholesale market Company Dutch employees (EUR bn) share (%)
2.8 6,571 24%
2.5 876 13%
0.7 1,469 11%
0.8 2,818 8%
ca. 0.6 5,000 6%
Revenue development of foodservice Future strategic market developments sectors (EUR bn) . According to a research report by ABN AMRO, the Dutch food service industry is forecasted to have a 20.0 18.4 2.3% growth in 2017 and a 2% growth in 2018. 17.9 17.5 17.5 17.9 Recreation . The growing need for a quick meal is not only met by 1.2 1.2 1.3 1.2 1.2 1.8 Hotels the traditional QSR but also by lunchrooms and by new 1.6 1.6 1.7 1.7 15.0 1.8 food concepts that “go organic” and/or “go healthy”. 1.8 1.8 1.8 1.8 Cafés . 2.3 2.3 2.3 2.3 2.4 With the digital age, traditional supermarkets are Quick being disrupted by a surge of food delivery services 10.0 2.5 2.6 2.5 2.4 2.5 restaurants (ready meals or meals to prepare). As a response, food On-the-go retailers are starting to implement foodservice / 3.2 3.2 3.2 3.2 3.3 “horeca light” concepts at their own supermarkets, 5.0 Catering e.g. the 2nd largest Dutch supermarket chain Jumbo 5.0 4.9 4.9 5.1 5.3 taking over La Place restaurants and introducing this 0.0 concept at their own supermarkets and many 2012 2013 2014 2015 2016 competitors introducing comparable concepts.
Source: Foodservice markt, Foodstep (2016); Foodservice in beweging, ING (2016); Financial reports (2016), CapitalIQ, Foodservice Beleidsmonitor (2017); Parent companies: Lekkerland AG (Lekkerland), Bidcorp (Deli-XL), Sonah (Hanos), Metro (Makro). Sligro also offers food retail through EMTE and Makro provides also non-food; Foodservice Insights, ABN AMRO (2017) 13 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN BENELUX
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m) Owner and operator of a The deal enables the opening new locations Lunch Garden SNC chain of self-service BE Gate Invest 52.0 and stimulating further growth. restaurants The transaction will enable investors to further promote sales and marketing of high Seamark Seafood, quality seafood in Belgium and Central Processor and distributor Fishproducts Icelandic Gadus NV BE 83.0 Europe as well as provide investors an seafood Iceland, and Akur opportunity to grow internationally and (PE) promote the image and value of Icelandic seafood in Central Europe.
Company engaged in the The acquisition will be a catalyst in the ISPC International wholesale of food products growth of Sligro’s current market segments BE Sligro Food Group 84.9 SA to the catering and and to expand its branch network in other hospitality industry Belgian cities.
The acquisition will strengthen Marfo Food’s position in the frozen meal food market and Providor of frozen ready Marfo Food Group increase market segments for Marfo Food. meals for food companies, BV Frigilunch NV BE 20.3 Post acquisition, Frigilunch will become the cafes, hotels, restaurants, Van Lanschot part of Marfo Food Group and both the companies, and institutions Participaties companies will operate independently under their own names.
Belgium-based company The transaction will enable Veviba and Adriaens NV engaged in the slaughtering BE Veviba N.A. Adriaens to strengthen their business in the and processing of beef Belgian slaughterhouse market.
Belgium-based foodservice The acquisition will enable Sligro Food to company: institutional and become the leading player in the Belgian JAVA Foodservice company catering market BE Sligro Food Group 129.0 foodservice market. The acquisition will segments and several hotel immediately contribute to Sligro Food’s chains earnings per share. The Netherlands is a highly attractive market which is underpenetrated for KFC KFC (16 Operator of a fast food Collins Foods NL 47.2 (‘15) restaurants and the acquisition portfolio is a establishments) chain Limited high quality business which is growing and generates strong margins.
The acquisition enables a new operational Autogrill Nederland Manager of restaurants, NL Gr8 Investments BV 33.0 concept of medium-priced hotel offering BV hotels and coffee stores with the emphasis on automated efficiency Sociedade Francisco Monterroio BV Food distribution company NL N.A. N.A. Manuel Dos Santos Takeaway.com strengthens its position in Provider of food ordering the Benelux, in line with the strategy to Just-Eat Benelux BV NL Takeaway.com BV N.A. and delivery services expand its leadership positions in the European market. The deal enables the bidder to gain more Operator of restaurants Jumbo La Place BV NL 150.0 market presence in the food service chain Supermarkten BV industry as a hospitality specialist.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket 14 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN BRAZIL
15 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN BRAZIL
Current market situation . The Brazilian foodservice market in 2016, including restaurants, was EUR 122 billion. . The percentage of food eaten out of the home is 34%. This number will increase in the coming years for the following reasons: − Growth of 2x per capita income by 2036; − Increasing participation of women in the labor market; − Population growth: Brazil should reach a population of 227 million people by 2036; − Market development, both on the supply side and on the demand side; − Strong trend towards healthy food (very fragmented market full of small companies).
Top players in Brazil Segments
Company Sales (EUR m) Employees Others 4% Industry Distributor Cash and 40% 10,254 111,868 Carry 21% 4,778 45,000
2,247 19,000 Wholesale 1,575 7,200 with Delivery Cash and Carry 35%
412 3,122
406 2,031 Consumer market (billion) 340 1,713 466 436 410 293 1,770 379 344 Food Distribution
323 1,200 136 131 132 117 122 300 N.A.
253 N.A. 2012 2013 2014 2015 2016
228 1,000 BRL EUR
Source: Nielsen 16 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN BRAZIL
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m)
The Popeyes acquisition adds a successful 3G Capital/ Popeyes Louisiana and highly regarded brand with high Restaurant chain USA Restaurant Brands 229 Kitchen consumer loyalty to RBI, one of the largest International Inc. companies in the world.
Grupo Lala, S.A.B. Lala, a Mexican company, acquired Vigor to Vigor Alimentos SA Food producer BR 667 de C.V. expand its business in Brazil.
Partners Group intends to maintain the expansion of Hortifruti’s network. Pursuant Hortigil Hortifruti Retail company of fruit and Partners Group to the transaction, former members BR 394 S.A. (60% stake) vegetables Holding AG Hortifruti will remain close to the company. Partners Group now owns 100% stake in Hortifruti.
Arlon has completed a 35% acquisition of OK Superatacado the remaining shares of OK Superatacado, (Serrano Wholesale chain BR Arlon Group LLC N.A. Arlon intends to maintain the investment Distribuidora SA) for about 7 years.
Russi Supermercados was one of the leading supermarket chain in the country side of the Russi Supermarket/wholesale state of São Paulo. In the past 5 years, Russi BR Grupo Ricoy 263 Supermercados Chain was facing financial issues, Grupo Ricoy só the opportunity to grow the business and acquired Russi Supermercados. The Advent Private Equity firm, sold the 73% International Meal Restaurant holding BR Multiple Investors 395 remaining shares of the IMC for multiple Company (IMC) investors.
With the purchase of 20% of the company for USD 50 million, the investment will serve to expand the company. Taco Bell Brazil Taco Bell Brazil Restaurant chain BR Daniel de Jesus N.A. already has 17 units (all of them situated at São Paulo), the goal is to reach 1000 stores in Brazil in the next ten years.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket 17 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN DACH (Germany, Austria, Switzerland)
18 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN DACH
Current market situation . The foodservice sector is showing resilience to the . The stabilization of the euro exchange rate eases economic downturn with an increase of 6.3% in the strain on wholesale & production sectors in 2016. There was a rise of 7.4% in food Switzerland. Pressure on domestic prices is wholesaling, 4.7% in food manufacturing and lessening, and opportunities abroad are 14.6% in non-residential catering. Food retailing improving. changed little at 0.4%. . In Austria and Germany, demand remains intact . In the subsegments, the quick service and and stable, whereas Switzerland felt the effects of motorway catering make up about four-fifths of falling sales as well as weak domestic demand, the sales of top 100 food service companies. and the inability to pass on rising costs and lost . The foodservice industry is one of DACHs export sales. strongest industrial sectors in terms of turnover . Particularly in Germany and Austria, the trend is and number of employees. towards consolidation of wholesale & foodservice distribution businesses with 41 transactions in Germany from 2000 to 2016 and an average EBITDA multiple of 9x-10x. Top players in Germany
Company Sales 2016 (EUR m) Market share in DE (%)
2,083 11.4%
2,966 14.3%
5,447 28.7%
3,661 16.8%
586 0.6%
Note: Comprises sales generated only from the segments related to foodservice
Foodservice market share Turnover share of the Foodservice industry by category 2016, % by production 2016, %
Grain mill products & Retailers starch Direct sales 9% products Fish products from 4% 2% Meat producers Oils & fats products 10% 5% 20% Processed Logistics food & provider vegetables 5% 6% Animal feed Various food Cash & Wholesale 7% products 16% carry delivery Bakery & 19% 57% farinaceous Dairy products Drinks products 12% 15% 13%
Source: Tradedimensions GV-Markt 2016; Bulwiengesa Market Study; GAIN Report; METRO International Supplement; Genios Food Service 19 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN DACH
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m) Engaged in the The takeover of Huegli Holding AG leads to development, production numerous synergies and cost-cutting Huegli Holding AG and marketing of a wide CH Bell Food Group AG 327.8 potential, the expansion of the product range of foods and food range, but also to a slight increases in the products. profit margin
With the merger, the entrepreneurs want to TransGourmet offer their employees a long-term Zanini SA Switzerland-based winery CH 35.0 Holding AG perspective and make optimal use of the synergies of both companies
The board of METRO AG is preparing the Wholesale, food, logistics, METRO AG creation of two independent and sector Metro AG DE 37,496.0 IT and real estate business (shareholders) focused companies through a demerger of the group.
Distribution, purchasing, The entry of Transgourmet into the Transgourmet Team Beverage AG marketing and service beverage market should meet increasing DE Deutschland GmbH 1,300.0 (70% Stake) platform for the beverage customer need for more performance and & Co. OHG industry fewer contact partners.
The acquisition of Pier 7 Foods accomplishes Pier 7 Foods Import Distributor of food to the Bid Corporation DE 48.3 Bidcorp’s objective of market entry into GmbH gastro-hotel industry Limited Germany. The acquisition is in line with Bidcorp’s strategy to expand its footprint into Company engaged in Guzman geographies which offer solid growth in the distributing and delivering Bid Corporation Gastronomia, S.L. ES 100.0 food services market. It will enable Bidcorp food to gastro-hotel Limited (90% Stake) to position itself as one of the leading industry foodservice companies in south-west Europe.
With the takeover of IFC, BIP Germany is International Food Wholesaler of food, securing one of the German market leaders Cooperation DE BIP Holland B.V. 25.7 beverages, and tobacco for licensed confectionery and Germany GmbH strengthening its own German business.
Company specialized in the This acquisition is in line with expanding development, production Bresc B.V. NL Huegli Holding AG 12.0 Huegli’s culinary competence in the fast- and sales of chilled garlic growing foodservice segment. and herb products
The acquisition will enable Ceconomy to realize their wholesale business expansion RUNGIS Express AG Wholesaler of fresh foods DE Ceconomy AG 130 plans in Germany and to further expand their food service distribution concept.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket 20 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN FRANCE
21 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN FRANCE
Current market situation . In 2016, the French foodservice sector showed resilience to the economic downturn with a 0.7% increase, after 3 consecutive years of decrease between 2013 and 2015. . In 2016, The French foodservice market reached an estimated value of EUR 54.6 billion. . In France, around 4,000 companies serve the HoReCa companies and are divided into 5 main segments (Cash & Carry, Logistics & Transport, Wholesales & Delivery…).
Main segments of the foodservice distribution market
Foodservice distribution market
“Full line” Traditional Specialized Cash & Logistics & wholesalers wholesalers wholesalers Carry Transport
. Some companies active in the foodservice distribution are focused on a specific segment (for example STEF is specialized in Logistics & Transport) but other companies are active in several segments.
Key players in the foodservice market in France
Revenue Company Segment (EUR bn)
Foodservice 22
Foodservice 17
Beverages 9
Cooperative 5
Cereal processing 5
Foodservice 4.8
Foodservice 4.4
Wholesale & delivery 3.6
Foodservice 3
Logistics & Transport 2.8
Source: «Le marché de la restauration hors domicile sort du tunnel avec le retour de la croissance après 3 années consécutives de recul» (NPD, 2017); «Les fournisseurs de la restauration hors foyer» (Xerfi, 2015); «Les grands défis des fournisseurs de la restauration à l'horizon 2020» (Xerfi, 2017); «Etude de la distribution sur le marché Food service France» (Gira) 22 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN FRANCE TOP 20 FOOD & BEVERAGE DISTRIBUTION NETWORKS FOR FOODSERVICE INDUSTRY
Revenue Warehouses & Logistic Rank Company Staff Shareholders Customers Products (€m) platforms
Metro Cash & 4,306 Fresh and frozen 1 9,500 Metro Group 93 warehouses & 20 platforms 1,000,000 Carry France (2016) products, grocery
Groupe 3,600 Fresh and frozen 2 8,600 Family Dewavrin 140 sites 150,000 Pomona (2016) products, grocery
1,495 Les Maîtres laitiers 3 France Frais 3,540 103 companies 70,000 Dairy products (2014) du Cotentin
1,330 Members of the 4 C10 3,500 240 warehouses & 1 platform 90,000 Beverage (2014) network
Transgourme 1,170 5 3,900 Swiss Coop 35 warehouses & 20 platforms 65,000 Grocery t France (2015) Martin 1,110 7 distribution centres & 1 6 Brower 774 Reyes Holding N.A. Logistics services (2014) platform France 1,070 Fresh and frozen 7 Promocash N.A. Carrefour 138 stores & 11 drives 320,000 (2014) products, grocery
970 Companies: 39 (fruits & Fruits, vegetables, 8 Creno 2,500 Cooperative N.A. (2014) vegetables) and 17 (seafood) seafood (fresh)
990 73 companies, 135 warehouses 9 Distriboissons N.A. Cooperative 60,000 Beverage (2015) & 1 platform
France 940 10 2,682 Heineken 14 platforms & 78 warehouses 56,500 Beverage Boissons (2014)
732 Grocery, meat, seafood, 11 Brake France 2,000 Sysco 45 platforms 45,000 (2016) vegetables
637 12 Davigel 2,922 Sysco 13 regional centres 70,000 Frozen products (2016)
645 Grocery, meat, seafood, 13 Pro à Pro 1,700 Metro Group 20 warehouses 30,000 (2014) fresh products
Relais d’Or 578 14 670 Pomona 17 members, 56 sites 84,300 Frozen products Miko (2014)
Back Europ 557 15 1,600 Cooperative 43 companies 36,000 Grocery & Snacking France (2014)
500 Fresh & frozen 16 Hexagro 3,000 Cooperative 26 members & 35 warehouses N.A. (2014) vegetables and seafood
300 17 Gedal 400 N.A. 29 members & 37 warehouses 25,000 Grocery (2014)
300 8 companies, 18 platforms & 30 Fresh & frozen products, 17 Réseau Krill 1,000 Groupe Even 35,000 (2014) sites meat
220 21 Centrale 25 distributors in France & 83 19 DGF 1,000 15,000 Bakery products (2016) Partners worldwide 250 20 Carigel N.A. Sysco 14 members N.A. Frozen products (2014)
Source: Top 20 des réseaux de distribution alimentaires et boissons en RHD en 2014 (Tokster, 2015) 23 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN FRANCE
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m) Brands: Conserverie du Financière Turenne Languedoc, Julien Mack, Financière Turenne Lafayette filed for Lafayette (canned FR Cofigeo; Arterris 324 Soulié Restauration, insolvency in June 2017. food division) William Saurin Garbit, etc. Supplier of chilled, frozen Beijing Sanyuan Sanyuan and Fosun will benefit from St and ambient products to St Hubert FR Foods Co.; Fosun 126 Hubert's healthy foods and technological retail and food service International innovations. customers The transaction will enable Ajinomoto to Labeyrie Traiteur Manufacturer of frozen Ajinomoto Foods expand and enhance its business operations FR 50 SUrgeles foods Europe for frozen foods in France and accelerate its growth.
The consideration represents 20 times the Stonyfield Farm Producer of organic yogurts US Groupe Lactalis 351 EBITDA of Stonyfield in 2016.
René Laurent's activity is synergetic with Development, production Frutarom's activity in the field of flavors and René Laurent and marketing of flavors FR Frutarom 12 in line with Frutarom's rapid growth and natural extracts strategy.
Producer of salads, fruits, This acquisition will help fuel the growth of Ready Pac Foods US Bonduelle 760 vegetables and snacks both companies in the fresh food space.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket; CFNews 24 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN ITALY
25 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN ITALY
Current market situation . The foodservice market in Italy has recorded a further growth in 2016, driven by the increasing habit of the Italians to go out for lunch and dinner. . Every year, the Italians spend more than EUR 200 billion on food out of which about 35% is spent in bars and restaurants. . Over the last 10 years, the Italian food & beverage on offer more than doubled and new bars and fast-food places are located in transport hubs such as railway stations and airports. . The foodservice market reflects this trend and has more than 3,890 independent food distributors with a market value of about EUR 8.6 billion. . The five main providers are adapting their product range to new market requirements: − highly customizable products for both collective and retail food service; − complete selection of products: fresh and frozen food, long-life products, beverages; − provision of catering services and solutions for several circumstances; − well organized distribution network; − choice of branded and non-branded products.
Out-of-home market 2016, %
Beverage; 25% Food; 75%
Top 5 players
Company Sales 2016 (EUR m) Employees
1,481.0 845.0
922.8 3,208.0
286.8 230.0
182.2 230
138.5 141.0
Sources: Aida BvD; Market trend report issued by Formind S.r.l. 26 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN ITALY
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m)
Italy-based company Edmond de The PE fund acquired DIMAR in a engaged in the distribution Rothschild D.I.MAR. S.r.l. IT 80.0 management buyout auction to support the of fish and frozen fish Investment business expansion of the company. products Partners, S.A.S.
The transaction is in line with the Orsero Italy-based company group's strategy to strengthen the Fruttital Firenze engaged in wholesale IT Orsero S.p.A. 40.9 distribution of fresh fruit and vegetables in S.p.A. distribution of fresh fruits Southern Europe and expand the activities and vegetables of the acquired company.
Gruppo Argenta This acquisition will allow Gruppo Argenta to Italy-based company S.p.A., Kohlberg develop the Foodies brand by opening 50 Tramezzino Itì S.r.l. engaged in providing food IT Kravis Roberts & Co. 4.4 new branches under the brand name delivery services L.P., Motion Equity Foodies. Partners
Italy-based company The acquisition will strengthen Marr's engaged in distribution of DE.AL. S.r.l. IT Marr S.p.A. 56.6 presence in the mid-Adriatic area and will food products to the enhance the service offerings. foodservice sector
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket; FactSet 27 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN THE NORDICS
28 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN THE NORDICS
Current market situation . The foodservice sector has recovered from the economic downturn and is growing in all Nordic countries. It is expected to continue towards 2021 with CAGR of 3% in total. This reflects a general trend where consumers are spending more time out of their homes and less in their own kitchens. . As the catering business/foodservice supports the consumer food business and is thereby linked directly to the development of consumer food service, companies in this sector have also experienced growth. At the same time food retail is selling more ready-to-go food than ever. . The market is attractive right now as investors are seeking business areas with resilience in case we are approaching a slower period again soon.
Top 5 players
Company Sales 2016 (EUR m) Employees
603 N.A.
560 847
421 N.A.
373 717
270 N.A.
Turnover share of the consumer foodservice Consumer foodservice market share by industry by country in 2016, % category in 2016, EUR m
2016 distribution Scandinavian consumer foodservice market 35,000 Finland; Denmark; 17% 20% 30,000
25,000
20,000
15,000 Norway; 21% 10,000
5,000
Sweden; 0 42% 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
DK SE NO FI
Source: Euromonitor 29 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN THE NORDICS M&A transactions 2016-2017 Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m) Manufacturer of high end FoodService Grambogård A/S DK 7 Access to prime meat products and dairy. meat and dairy products Danmark A/S Manufacturer of meat and SR Food A/S DK Dragsbæk A/S 8 Access to pastry products and more. pastry products Andys Fruit – supplier of Menigo Foodservice Clafra AB SE 25 Increase in fresh food. fresh fruit AB Axfood Eurocash Food AB 7 large B2B food stores SE 95 Access to bigger marketshare in Sweden. AB/Norgesgruppen
Skagen Food Distributor of fish products DK Dansk Supermarked 133 Access to 19,000 online customers weekly.
Internatural AB Kung Markatta and Helios SE Midsona AB 64 Increase share organic food.
mat.se – online delivery of Axfood Matse Holding AB SE 30 Increased access to online B2C market. weekly food boxes AB/Norgesgruppen FoodService Grøn Fokus Ecology products DK 8 Expand into organics. Danmark A/S Largest manufacturer of Eckes-Granini Group Arla (Dairy) was looking to divest their juice Rynkeby Foods A/S DK 95 juice in Denmark GmbH company. Producer and distributor Consolidation/increased presence in Västkustfilé Ab SE Insula AS 30 fish products Sweden. Leading manufacturer and Leading manufactorer of pepperoni high Dk-Food's A/S DK Maj Invest Equity 20 distributor of pepperoni growth. Orkla Foods O. Kavli A/S Drinking products DK 24 Expand into drinking products. Danmark A/S FoodService Ch Interfrugt A/S Organic fruit DK 13 Parent company of Grøn Fokus. Danmark A/S Kaivonliha Beef processing and FI Atria Oyj 43 Complement Atria’s beef product range. Kaunismaa Oy wholesale Lagerberg i Norjeby Producer of chicken SE Atria Oyj 30 Enter poultry business in Sweden. Ab products Paimion Strengthen HKScan’s position in the beef Beef slaughterhouse FI HKScan Oyj 14 Teurastamo Oy market. Breakfast cereals and other Frebaco Kvarn AB SE Oy Karl Fazer Ab 29 Increase oats production capacity. grain products
Västkustfilé AB Fish products SE Insula AS 25 Strengthen position in Sweden.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket; Capital IQ 30 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN POLAND
31 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN POLAND
Current market situation . In recent years the foodservice sector in Poland has been systematically growing. In 2016, this market grew by 7%. . Polish society is becoming more wealthy, which drives foodservice and related industries. . The foodservice industry belongs to the most important sectors of Polish economy.
Turnover share of the foodservice industry Top players in Poland by product, %
Grain mill products & Sales 2016 starch Company Employees products (EUR m) Fish products 3% 4% Oils & fats 765 3,200 Bakery & 2% farinaceous products Meat 574 1,100 6% products 28% Animal feed N.A. 10,900 7% Fruits & 110 500 vegetables 8% 5,072 9,340
Drinks Various food 11% products Dairy products 17% 15%
HoReCa industry suppliers type, %
77%
25% 12% 6% 3% 2% 1%
Wholesale (with Direct from Makro Cash&Carry Wholesale (without Selgros Cash&Carry Food market Eurocash delivery) producer delivery)
Source: Statistics Poland; Polish Investment and Trade Agency 32 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN POLAND
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m) The transaction is in line with the Eurocash's Mila S.A. Supermarket chain. PL Eurocash S.A. 344 strategy to build nationwide supermarket chain.
The acquisition of Pini Polska has increased Meat processing and Smithfield Foods, Pini Polska sp. z o.o. PL 1,104 Smithfields‘s production and export packaging plant Inc. capabilities of quality meat.
The acquisition will help Żabka to capitalize Zabka Polska sp. z Convenience stores chain CVC Capital Partners PL 1,468 on growing market opportunities and o.o. owner and operator Limited enhance the existing store network.
Charoen Pokphand With this transaction CPF intends to invest SuperDrob S.A. Poultry producer PL Foods Public 230 in the Polish market and gain access to its (33% stake) Company Ltd distribution channels.
Abris Capital This transaction allow Abris Capital Patners Graal S.A. (55.77% Listed on the WSE frozen PL Partners and private 223 and private investor to delist the company stake) and chilled food producer. investor from the Warsaw Stock Exchange.
Dakri Dystrybucja Bakery products production Through this transaction Bake & Co N.V. has PL Bake & Co., N.V. 15 sp. z.o.o. and distribution enlarged its portfolio.
Organic Farma The acquisition will help Organic Farma Zdrowia S.A. (63% Organic food retail chain PL EcorNaturaSi S.p.A 21 Zdrowia in development and will accelerate stake) the expansion of the Polish market.
Nordfish-Foodmark The transaction will strengthen Lisner’s Fish products producer PL Lisner sp. z o.o. 39 sp. z o.o. position on the Polish market.
QFG sp. z o.o. (60% Producer of poultry, beef Highlander The transaction will allow QFG further PL 27 stake) and pork based products Partners, L.P. development and production enhancement.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket 33 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN SPAIN
34 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN SPAIN
Current market situation . Clients are requesting more complex services to logistics operators and increasing the number and frequency of orders while reducing their size, and concentrating their Iberian market contracts into larger operators who offer full coverage in the Iberian market. . Food producers and distributors insist on higher quality standards through the whole distribution chain requesting more stringent quality controls and traceability from logistic operators. . Domestic food producers are increasing exports in order to compensate for a decrease in the domestic market, representing an opportunity for logistics service providers. . Food exports are growing in the range of 5%-10%. . The largest multinationals have domestic coverage but generally are focused on large retailers with limited reach and do not offer complex services. . Food retailers are demanding advanced logistics methods (“just in time”), forcing food manufacturers and intermediaries to choose between investing in installations or outsourcing logistics services to specialized logistics service providers. . Some segments in the food market such as wholesalers are starting to see the potential benefits of outsourcing their logistics operations. . Independent Hospitality: Most of the expenditure in HoReCa supplies is concentrated in Distributors / Wholesalers. . Organized Hospitality: Except the drinks, where purchases are made directly through the manufacturer, the rest of products for the majority of these groups are obtained through a logistics operator.
Top 5 players in purchasing groups Suppliers market share (% of the total)
4% 5% Company Sales (EUR m) 3% 5% 9% 9% 4% 13,795.0 21% 23% 400.0
385.2 63% 54% 282.7
189.0
2008 2013
Other retailers Self Service Cash & Carry Manufacturer Multicategory Distributor Specialist Distributor
Source: Ministerio de Agricultura, Alimentación y Medio Ambiente 35 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN SPAIN
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m) This majority stake transaction expands Destilerias Mg SL's global presence and Import and distribution of Amer Gourmet SL ES Destilerias Mg SL 4.7 enhances the portfolio of brands and alcoholic beverages distribution channels of the company in Spain. The acquisition strengthens the operations of BM Supermercados, the supermarket Grupo Uvesco SL chain of Grupo Uvesco SL. The transaction is Cermol 79 SA Supermarket chain ES 59.9 (IFA Española) a result of the insolvency situation and auction process for "Gigante Supermercados" (Cermol 79). Grupo Osborne SA Consorcio de Jabugo Producer and marketer of (Shanghai Fosun The acquisition allows Grupo Osborne to ES 25.0 SA (Agrolimen SA) Iberian pork products Industrial increase turnover by more than 30%. Investment Co. Ltd.)
The acquisition (90%) is in line with Bidcorp’s strategy to expand its footprint Processor and distributor of into geographies which offer solid growth in Guzmán fresh and frozen fruits and ES Bid Corp. Ltd. 100.0 the food services market. It will enable Gastronomía SL vegetables Bidcorp to position itself as one of the leading foodservice companies in south- west Europe.
Orsero SpA acquired the remaining 50% Hermanos Distributor of fruits and stake not yet owned. The acquisition ES Orsero SpA 170.0 Fernandez Lopez SA vegetables enables Orsero SpA to enhance its portfolio of existing business.
Grupo Lar SA acquired 22 Eroski Eroski (Rockspring Supermarket from Rockspring Property Property Supermarket chain ES Grupo Lar SA 5,490.0 Investment Managers LLP for EUR110.7 Investment million. The acquisition enhances the Managers LLP) business portfolio of Grupo Lar SA.
Productos Wholesaler of frozen fish Turolinnova SL ES Congelados Selectos 2.1 N.A. and other products 3000 SL
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket 36 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN THE UK
37 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN THE UK
Current market situation . The delivered UK foodservice sector continues to remain resilient in the face of rising wages and food costs, growing by 1.9% in 2016 to reach a market value of GBP 10.1 bn. . This growth has been driven by an increasing consumer demand for eating out which has led to a strong performing and expanding restaurant, pub and hospitality scene in the UK. . Chilled and fresh food was the biggest growing single category, demonstrating the growing importance to UK foodservice customers of having fresh natural products at the core of their offering. . The delivered foodservice sector is anticipated to grow at a CAGR of 2.5% to reach £11 bn. by 2021 driven by continued growth in the UK eating out market. . This growth may be stunted by challenges created by the UK’s exit from the European Union, with the rising costs of food imports and possible labour shortages impacting upon the UK foodservice sector as a whole.
Top players in the UK Market share in the Company Sales 2016 (GBP m) Employees UK (%)*
3,295.0 12,418 18%
5,327.9 13,533 16%
2,360.0 8,990 15%
432.1 >1,000 6%
288.1 >1,000 4%
*Market share relates to foodservice element of total sales.
Delivered foodservice – % growth by category, UK Foodservice market: frequency of eating out
2016 Increased eating out amongst UK consumers continues to drive sales in the delivered foodservice market 5.0% 4% 100% 4.0% 90% 23% 3.0%
80% 29% food Durables food 2.0% -
Non 70% 1.0% 60% 0.0% 26%
50% 55%
-1.0%
40%
-2.0% 30% 18%
food food
-
Food
Tobacco
Alcoholic Alcoholic Beverages
-3.0% Drinks Soft 20%
Frozen Food Frozen Non
Ambient Food Ambient 12% 16% Consumables Chilled & Fresh Fresh & Chilled 10%
0% 1989 2016 I don't eat out Less than once a month Once a month Once a fortnight Once a week More than once a week Source: IGD Research 2017; Mintel 38 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN THE UK
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (EUR m)
Tesco PLC to gain market share in the Company engaged in the Booker Group PLC UK Tesco PLC 5,957 grocery market with the acquisition of wholesale of food. leading food wholesaler, Booker.
Company manufactures and distributes sandwich The acquisition of Calder Foods will both Calder Foods Flagship Europe fillings, marinated and UK 25 compliment and expand the food-to-go (Manufacturing) Ltd Limited cooked meats, salads, product offering by Flagship Europe. chutneys, and sauces.
Company supplies food The UK arm of CP Foods acquired a 60% The Foodfellas CP Foods (UK) products to the foodservice UK 59 stake in Foodfellas to expand into the Limited (60% stake) Limited market. foodservice market in the UK.
Catering butcher that The acquisition of Knight Meats has Knight Meats supplies fresh meat, UK Bidcorp N.A. increased Bidcorp‘s capabilities in the Limited poultry, and deli products delivery of quality meat. to the professional kitchen.
Company supplies frozen, chilled and ambient foods Bidcorp‘s acquisition of Caterfood has Caterfood Holdings to pubs, restaurants and UK Bidcorp 14 strengthened the companies operations and caterers, predominately in services in the South-west of England. the South West of England. Company supplies frozen,
chilled, and ambient foods Sysco‘s acquisition of Brakes Group has to pubs, restaurants, Brake Bros Limited UK Sysco Corporation 3,684 increased their access into European hotels, hospitals, schools, markets. care homes, and leisure
facilities
Notes: - Conversion to euros for the transaction value is based upon the relevant exchange rate at the date of the transaction as taken from Capital IQ. - Conversion to euros for the Revenue figure is based upon the spot rate as of 17/11/2017 (1:1.1206)
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket; Capital IQ 39 SECTOR SPOTLIGHT: FOODSERVICES
KEY FACTS ABOUT FOODSERVICE IN USA
40 SECTOR SPOTLIGHT: FOODSERVICE
KEY FACTS ABOUT FOODSERVICE IN THE US
Current market situation . Restaurant industry sales in the United States are expected to reach USD 800 billion in 2017. . Total employment in the restaurant industry is estimated at 10 million across full service establishments, quick service restaurants, and other providers such as cafeterias and caterers. . Consumer spending, a key driver for establishments serving meals outside the home, has steadily increased since the recession. − Per capita disposable income is projected to grow at a 2.7% annual rate for the next five years − The USDA forecasts that money consumers spend eating outside the home will increase faster than the amount of money spent eating at home in future years . Other significant trends include consumers increased preference for convenient / quick yet healthy dining options, and the rise of the fast casual space . Foodservice outlets continue to be the most significant source of revenue for food wholesalers, as restaurants, hotels and other establishments rely on distribution networks to procure food products.
Top food distribution players in the United States Revenue Company Number of Employees (USD m)
57,007 66,500
. 29,178 17,000
. 23,829 25,000
17,081 14,000
9,454 9,700
Grocery Wholesale Market Segments % of Total Food Expenditures at Home vs. Away from Home Other 56% Other 3% Wholesalers 54% 16% 52%
50%
48%
46% Supermarket Food Service 44% s and Outlets Grocery 56% 42% 26% 40% 2000 2002 2004 2006 2008 2010 2012 2014
Food at Home Food Away from Home
Source: Forbes, IBISWorld, USDA 41 SECTOR SPOTLIGHT: FOODSERVICE
MAJOR FOODSERVICE TRANSACTIONS IN THE US
M&A transactions 2016-2017
Target Target Target Transaction Target Acquiror Revenues Description Country Rationale (USD m) Provides event venue The acquisition strengthens Sodexo’s Centerplate, Inc. catering and hospitality US Sodexo S.A. 998 position in the North American market. services Engages in the ownership, The acquisition leverages NRD’s experience development, operation, NRD Capital Ruby Tuesday, Inc. US 913 in achieving profitable growth for restaurant and franchise of casual Management, LLC concepts. dining restaurants. Ninety Nine Owns and operates a chain The acquisition will result in a diversified US J. Alexander's LLC 304 Restaurant, Inc. of restaurants. player in the casual dining segment. Imports and distributes The acquisition will diversify High Liner’s Rubicon Resources, High Liner Foods seafood and seafood US 234 product portfolio and provide a platform for LLC Incorporated products. growth. Owns, operates, and Panera Bread The acquisition is in line with JAB Holdings’ franchises retail bakery- US JAB Holdings B.V. 2,795 Company strategy of investing in consumer brands. cafes. Operates as an onsite The acquisition will enhance ISS’s service Guckenheimer corporate restaurant US ISS A/S 327 offering in the North American market and Services, LLC management and catering improve its catering services. company. Owns and operates Darden Restaurants, The addition of Cheddar’s is complementary Cheddar's, Inc. US N.A. restaurants. Inc. to Darden Restaurants’ portfolio of brands. Checkers Drive-In Owns and operates a drive Oak Hill Capital The acquisition is in line with Oak Hill Capital US N.A. Restaurants, Inc. thru restaurant chain. Partners Partner’s investment strategy. Develops, operates, and The acquisition strengthens Restaurant Popeyes Louisiana Restaurant Brands franchises quick-service US 269 Brands’ US and international prospects for Kitchen, Inc. International Inc. restaurants. growth. Provides food products to All American Foods, US Foods Holding US Foods will build on All American Foods foodservice establishments US 60 Inc. Corp. operations in New England. and SKUs. Comprises business of ConAgra Foods, Inc., The divestiture will allow ConAgra Foods to sourcing and distribution of US Platinum Equity, LLC N.A. JM Swank Business become a more focused company. food products. The acquisition solidifies MTY’s presence in Engages in franchising MTY Food Group Kahala Brands, Ltd. US 130 the United States and creates a diverse quick-service restaurants. Inc. combined portfolio of brands. Operates as a branded retailer and wholesaler of The acquisition is in line with JAB Holdings’ Krispy Kreme doughnuts, coffee and US JAB Holdings B.V. 523 strategy of investing in consumer brands. Doughnuts, Inc. other complementary
beverages, and treats and packaged sweets. Provides onsite corporate, Compass Group The acquisition enhances Compass Group’s CulinArt Group, Inc. educational, and leisure US 264 USA, Inc. service offering. dining facilities.
. For information on transaction values, please contact the local Clairfield expert (page 43).
Source: Mergermarket; Capital IQ 42 SECTOR SPOTLIGHT: FOODSERVICE
CONTACT US
Clairfield consumer & retail team
ALBERT SCHANDER GARY ECOB Sector heads Germany United Kingdom [email protected] [email protected]
MARK STEINHART BEREND YNTEMA DAMIEN COPPIETERS GABRIEL LOEST Australia Austria Belgium Brazil [email protected] [email protected] [email protected] [email protected]
ALLAN BJØRN TOMMI WALTHER ANTOINE ROUÉ-LECUYER MARTIN LEMMER Denmark Finland France Germany [email protected] [email protected] [email protected] [email protected]
OLIVER NEMES ANTONIO SCARABOSIO LUIS CORIA RUUD VAN HOEK Hungary Italy Mexico The Netherlands [email protected] [email protected] [email protected] [email protected]
JOSTEIN S. PETTERSEN PETER CHUDY BRIAN O’HARE BJÖRN ÅKERLUND Norway Poland Spain Sweden [email protected] [email protected] [email protected] [email protected]
KYLE SCHICKNER ERIK ZALENSKI IGNACIO J. KLEIMAN United States United States United States [email protected] [email protected] [email protected]
Contact details – Sector heads
Dr. Albert Schander Gary Ecob [email protected] [email protected]
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43 SECTOR SPOTLIGHT: FOODSERVICE
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