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March 23, 2021

Equity raise will help growth, food group Greenyard says

The Belgium-based vegetable-products supplier has a new shareholder, the head of which now has a seat on the company's board.

By Dean Best

An equity raise at Greenyard, the Belgium-based food group, will help the company grow sales, the company has told just-food.

Greenyard, which sells fresh, frozen and prepared foods to more than 20 countries, has announced a “capital commitment” from two investors, as well as a refinancing of its outstanding debt.

The capital commitment is worth EUR50m (US$59.4m) and has seen an existing shareholder, Joris Ide, and a new investor, Belgium-based fund Alychlo, buy equity in the business.

In the wake of the investment, Ide will own 3% of Greenyard. Alychlo, the family investment vehicle of Belgian businessman Marc Coucke, will own just over 13%. Coucke, the founder of pharmaceutical company Omega Pharma, will take a seat on the Greenyard board.

Greenyard, meanwhile, also has a new agreement covering EUR467.5m of financing.

“The totality of this announcement was the last piece of the puzzle after our transformation. We are a leader in the industry, and we will continue to deepen our relationships throughout the chain, focusing on a sustainable and healthy future for all,” a Greenyard spokesperson said.

In 2019, Greenyard installed a “transformation team” to instigate a turnaround plan after disappointing financial results, with sales and margins hit by what it called “continued pressure in the food retail landscape”, particularly in Belgium and Germany.

The spokesperson added the equity raise would support Greenyard’s growth strategy, including in areas such as innovation – where, he said, the supplier was looking to “co-build” products with customers – and sustainability.

“It will help us in accelerating the path we have been on for a while now,” the spokesperson said. “This concludes the transformation and allows us to fully focus on our ambitious long term plans as they were announced before, including co-building and innovating with our customers, for instance frozen soups en smoothies, meal boxes, canned/jarred prepared sauces.”

In a statement alongside the announcement of the equity raise and the refinancing, Coucke said: “Greenyard has shown great resilience, fighting spirit and entrepreneurship to become a healthy company again. On top of that, Greenyard is working in an attractive sector, fruit and vegetables, that is set to become even more important in the coming years as consumers increasingly look for healthy consumption products. We are looking forward to working together on the execution of the business plan and beyond.”

In Greenyard’s last full financial year, which ran to 31 March 2020, the company’s net sales grew 3.8% to EUR4.06bn. The company made a loss an EBIT level of EUR2.6m, compared to EUR133.4m a year earlier, when its results were hit by impairment charges and costs from a listeria recall. Adjusted EBITDA stood at EUR95.7m, up 48.4% on the previous year.

Last month, Greenyard posted sales for the third quarter of its current financial year. Sales from continuing operations rose 10.3% to EUR1.09bn. It said it was targeting an adjusted EBITDA of EUR106-110m. The company’s annual results are due for publication in June.

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