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May 13, 2022

Nomad Foods co-chairs mull options for frozen-food group

Martin Franklin and Noam Gottesman are weighing up the possible next steps for the Iglo and Birds Eye owner.

By Dean Best

The co-chairmen and founders of Nomad Foods are “evaluating potential strategic alternatives” for the European frozen-food maker.

In a filing with the US Securities and Exchange Commission, one of Nomad Foods’ co-chairs, Noam Gottesman, said he had started talks with fellow chairman Martin Franklin about options for the Iglo and Birds Eye owner.

Gottesman said the discussions focus on “exploring and evaluating potential strategic alternatives” that include “a merger or other similar transaction” involving Nomad Foods, a change to the company’s “present capitalisation or dividend policy”, a new “corporate structure” for the business and a delisting from the New York Stock Exchange.

Gottesman and Franklin, who both own around 7% of the business, have informed Nomad Foods’ board, the filing added.

In an interview on Bloomberg TV yesterday, Franklin said the men believe the manufacturer is “mispriced,” and “wanted to review what our alternatives were”.

Just Food has approached Nomad Foods for comment.

Gottesman and Franklin set up the then Nomad Holdings in 2014 as a vehicle to make acquisitions. A year later, that vehicle became Nomad Foods through the purchase of European frozen-food business Iglo Group, a deal swiftly followed with the addition of a clutch of Findus Group assets.

Acquisitions made since include buying the Goodfella’s brand from Boparan Holdings and snapping up UK-based frozen Yorkshire Pudding and roast potatoes maker Aunt Bessie’s from William Jackson Food Group.

In 2021, Nomad Foods generated revenue of EUR2.61bn (US$2.7bn), which was up 3.6% on the previous year, although down 2.1% on an organic basis.

The company’s adjusted EBITDA increased 4% to EUR487m, while its adjusted profit after tax grew 5% to EUR277m.

On a reported basis, Nomad Foods’ operating profit reached EUR342.7m in 2021, compared to EUR359.2m. The company’s net profit was EUR181m, versus EUR225.1m in 2020.

Earlier this week, the group reported its financial results for the first quarter of 2022.

The largest frozen-food products supplier in Europe saw its sales growth slow, in a reflection of the elevated demand during Covid-related lockdowns in the initial three months of last year.

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