CVC Capital to buy world’s biggest olive-oil bottler Deoleo SA for $603 mn

Spain's Deoleo SA today said that it has agreed to sell itself to British private-equity firm CVC Capital Partners in a deal valuing the world's biggest olive-oil bottler at €438.8 million ($603 million).

CVC's offer of €0.38 a share beat rival bidders in the auction that included private-equity firms Rhone Capital and PAI Partners, and a consortium comprising of Italy's state-backed strategic sovereign fund Fondo Strategico Italiano and Qatar Holding, the sovereign wealth fund of Qatar.

Four Spanish banks, including Bankia SA, Caixabank SA, Kutxabank and BMN, holding a total of around 32 per cent, had last year hired JP Morgan Chase to help find a buyer for their stakes.

Under Spanish law, a buyer purchasing more than 30 per cent stake in a Spanish business must make a full takeover offer for all of the outstanding shares of the company.

CVC will first buy the stakes held in Deoleo by the four Spanish banks and then launch a takeover bid for the rest of the Madrid Stock Exchange-listed company.

A cooperative of Spanish olive-oil farmers holding a 10 per cent stake in Deoleo have opposed the deal on the grounds that they do not approve selling the company to an overseas buyout firm when there were other alternatives including looking at a local buyer.

With over 320 million olive trees, Spain is the world's largest producer of olive oil, with 37 per cent of global production. 

Deoleo owns brands that are within the top three market leaders for bottled olive oil in the US, Italy, Canada and Germany, and also owns popular Italian brands Bertolli, Carapelli and Sasso, which it had acquired a few years ago.

Deoleo, formerly SOS Corporacion Alimentaria SA, produces vegetable oils, including sunflower seed and olive oils and has brands such as Carbonell, Bertolli and Carapelli, which account for 22 per cent of global sales of bottled olive oil.

It also produces a range of table olives, condiments and confectionary products, as well as special by-products from the olive-oil process.

Deoleo posted net profit of €20 million in 2013 on revenues of €813 million.