High Court lets Kerry get Breeo for €140m

The Competition Authority's earlier decision barring the Breeo acquisition has been overturned, allowing the Kerry Group to get the food company for a recessionary knocked-down price

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Last month the High Court overturned a decision by the Competition Authority prohibiting the Kerry Group from acquiring Reox Holdings-owned Breeo Foods. The transaction was completed on 19 March for a total consideration of €140 million.

Earlier this year the Competition Authority made a decision to stop the acquisition going through, on the grounds that it would “substantially lessen competition” in the Irish consumer foods market. The move by the CA had cost Kerry the €20 million non-refundable deposit to Reox Holdings.

Flor Riordan, Reox chairman, had said at the time that Kerry’s offer had represented “compelling value for Reox shareholders.”

Kerry Group chief executive, Stan McCarthy welcomed the High Court decision which allowed the company to proceed with its purchase of Breeo Foods. The transaction carried a cost of €140 million at the current market value, compared with €165 million, which was the price tag placed on the Breeo deal at the beginning of the year.

In a statement following the event, McCarthy said: “The business being acquired is entirely complementary to our Kerry Foods’ chilled foods branded offering on the Irish market and our national chilled foods distribution service. I believe we can achieve significant synergies in combining both chilled foods’ businesses which will benefit all stakeholders including consumers.”

He added: “I expect the transaction to be EPS neutral in the current year and to be earnings positive in 2010.”

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