€1.4bn bid expected for frozen food businesses

A CONSORTIUM of private equity firms was yesterday reported to be preparing a €1.4 billion bid for Unilever’s frozen foods arm which includes Birds Eye.

Capvest, CVC Capital and Kohlberg Kravis Roberts (KKR) have teamed up to buy the business, according to the Sunday Times.

Unilever put most of its European frozen food business up for sale in February as it struggled to find market growth. Among the brands being sold are Birds Eye and Iglo.

At the time, Unilever admitted it was a “tough call” to offload Birds Eye. The sale will impact on 3,500 workers.

The Sunday Times said initial bids were due in this week with Capvest, CVC and KKR seen as the favourites. Rival private equity firms thought to be interested include PAI, Lion Capital and Bain Capital and a deal is expected to be concluded by the end of the year.

Capvest is already a big player in the frozen food industry having bought seafood firm Young’s Bluecrest in 2002 and the Findus brand in Scandinavia in January.

The decision to sell Birds Eye and the other businesses came after frozen food sales fell 4.5% last year as consumers switched to fresh meat.

Despite the downturn in frozen foods, the Anglo-Dutch giant posted a 28% hike in annual pre-tax profits to €4.75bn last year.