Date
23 August 2019
In acquiring Arnott’s Biscuits, KKR will gain ownership of top-selling cookie brands such as Tim Tam. Photo: Reuters
In acquiring Arnott’s Biscuits, KKR will gain ownership of top-selling cookie brands such as Tim Tam. Photo: Reuters

KKR buying Australian Tim Tam cookie maker for US$2.2 billion

KKR & Co. said it is buying Campbell Soup Co.’s Australian snacks unit Arnott’s Biscuits that will give it ownership of top-selling cookie brands such as Tim Tam, in a deal local media reported was worth US$2.2 billion.

“I can confirm that KKR’s offer for Arnott’s was accepted by Campbell’s late last night,” an Australia-based spokeswoman for the New York-headquartered buyout firm said in an email, without specifying the price or commenting further.

The Australian Financial Review reported earlier without citing sources that the agreed sale price was US$2.2 billion, less than the over US$3 billion the seller reportedly wanted for the asset.

A Campbell Soup spokeswoman declined to comment on the report and said the unit had not yet been sold.

“The process to divest Arnott’s and the rest of our international operations is ongoing,” the spokeswoman for the US food company said in a statement.

The sale marks the second change of offshore ownership of a large Australian food and drink brand in a week, after Belgian beer maker Anheuser-Busch InBev agreed to offload its Australian operations – with best-selling labels like VB and Carlton Draught – to Japan’s Asahi for US$11 billion.

In 2016, Philippines-based Universal Robina Corp. (URC.PS) paid US$460 million for the maker of some of Australia’s best-known salty snacks, including CC’s, Kettle chips and Thins, from local interests.

Two years before that, Universal Robina paid US$470 million for New Zealand’s top snack maker Griffin’s Foods Ltd. from Australian private equity firm Pacific Equity Partners (PEP).

Though Australians are used to Arnott’s being owned by foreign interests – Campbell bought it in 1997 – the sale gives KKR control of assets that have been synonymous with snacking in the 12th-largest economy for a century and a half. Arnott’s also makes Iced Vovos, SAO, Wagon Wheel, Monte Carlo and Mint Slice biscuits.

Australian media had reported PEP bid for Arnott’s. Mondelez was also cited by Australian and other media as interested in the business, which the US company has declined to comment on. Representatives for PEP declined to comment.

Campbell put its international unit and “fresh” units up for sale last August under pressure from investors to improve profitability and stock performance.

This month, it sold its Danish unit Kelsen Group to an affiliate of Nutella maker Ferrero SpA for US$300 million.

Meanwhile, the Philippines’ Jollibee Foods Corp. said it is buying US brand Coffee Bean & Tea Leaf for US$100 million.

Jollibee said in a stock exchange disclosure on Wednesday it would acquire 100 percent of the Los Angeles-based specialty coffee and tea brand to boost its overseas sales.

Jollibee operates the largest fastfood chain in the Philippines with 3,195 restaurants. It also operates 1,418 stores across various brands overseas. Reuters

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CG

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