Strategics, private equity want a cracker; Arnott's sale docs land

Its global food and beverage heavyweights versus cashed-up private equity funds in the first round of a $2 billion-plus auction for Campbell Soup’s international arm, which includes biscuit-maker Arnott’s.
Street Talk understands auctioneer Goldman Sachs has non-disclosure agreements flying around like confetti this week, offering tyrekickers access to the confidential information memorandum in return for their signatures.

The early birds reckon the IM pegs the unit’s earnings at about $US200 million ($277 million) a year. So while there is plenty to play out in the auction, it looks like a $2 billion-plus cheque will be required to take the bickies. Literally.

All eyes are on the big global players.

Kraft Heinz – which is forecast to record $US26 billion revenue this year and has a $US63.2 billion market capitalisation – is lining up, and is understood to have investment bank UBS in its corner.

It’s up against countryman Mondelez International – also a $US26 billion a year gorilla and with a $US65 billion market capitalisation – advised by Morgan Stanley.
Private equity funds expected to take at least a preliminary look include Australia’s Pacific Equity Partners and BGH Capital, and regional funds KKR & Co and Affinity Equity Partners. Bankers are known to be circling these names and others in search of buy-side mandates.

Sources said the sale documents talked up Arnott’s strong brands – Tim Tams, Mint Slice, Shapes and the like – and Asian platform.

The up-for-sale division includes Arnott’s and Campbell’s soups, stock and juices in Australia and New Zealand.

First round bids are due just prior to Christmas, sources said, while owner Campbell Soup is targeting a deal in the new year.