A string of private equity bidders and food groups are preparing bids for Spanish pasta company Pastas Gallo, according to sources familiar with the situation.
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UK private equity group 3i and Spanish food group Siro have held discussions over a potential full or partial purchase of the company, which, said a Madrid buyout banker, has “a very attractive and profitable business.”
The banker added that other smaller buyout firms are also studying offers.
Pastas Gallo makes both dry and fresh pasta products and generated revenues of EUR230m (US$370.3m) in 2008.
While 3i could entertain a full takeover, Siro is more interested in snapping up Gallo´s fresh pasta line, with which it competes to supply supermarket giant Mercadona.
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By GlobalData“These companies are fierce competitors in the same product line to Mercadona,” the banker added. “Siro is keen to remove this rival and could pay a very high price for the business.”
According to the source, some members of the Espona family who control Pastas Gallo want the sale while others, including the late founder’s wife Pilar Massana, are opposing it.
The three companies were unavailable to comment.
