GEA Group has gone on a pre-Christmas spending trip, buying up Convenience Food Systems (CFS) and the Bock Group.
CFS is the biggest of the two target companies. It is a processing and packaging firm specialising in animal protein foodstuffs, with some 2000 employees and a turnover of about €400m.
GEA did not reveal how much it has agreed to pay for CFS but said the figure is based on an enterprise value of about €435m.
Food sector ambitions
It revealed that the deal is part of a defined strategy of expansion in the food sector and will serve as a platform for future acquisitions.
Juerg Oleas, CEO of GEA, said: “This acquisition follows our declared strategy to expand the food process technology activities of GEA Group horizontally. We are taking our portfolio another big step forward towards the less cyclical food industry.”
Niels Graugaard, COO of GEA, added that GEA sees potential to considerably boost the profits at CFS and to realise synergies with existing GEA businesses.
Speaking for CFS, Brian McCluskie, CEO, said the animal protein market (meat, fish and cheese) is one of the fastest growing in the industry and being part of the bigger GEA group will give it the best chance of exploiting that expanding market potential.
Meanwhile, the acquisition of Bock is a smaller bolt-on affair. The supplier of piston compressors for cooling applications employs some 340 people and expects a turnover of just under €70m in 2010.
Bock will be integrated into the GEA Refrigeration Technologies segment, where GEA says the acquisition will expand its range in the lower and medium refrigeration capacity. Typical customers are found among food and drink producers as well as some of the largest food retailers.
Oleas said: “Bock instantly gives us access to a much wider range of cooling applications and they also enhance our know how with regard to environmentally friendly solutions based on natural refrigerants.”
Both the acquisitions of CFS and Bock are subject to regulatory approval.