CSM sheds BakeMark Sweden to equity group

Related tags Bakery ingredients Private equity Cvc capital partners Csm

Dutch bakery ingredients leader CSM continues to shed activities in
non-core countries, selling off its Swedish subsidiary BakeMark
Sweden to private equity group Accent, Lindsey Partos

Under terms of the €8.75 million deal, Accent Equity Partners will take over all the operations of BakeMark Sweden, that has a turnover of €28 million, including the factory in Fagersta and the head office in Stockholm.

The transaction, that will include a book loss of €7 million for CSM, is expected to close on 1 May 2005.

This latest move slots into CSM's restructuring plans, announced last year, that are expected to bring benefits of €50 million in net savings for the firm over the next two to three years.

Playing a pivotal role in the structural changes of the company, the group recently announced a 'definitive agreement' for the sale of its considerable sugar confectionery activities to CVC Capital Partners for €850 million.

Proceeds from the unit, that rolls over €750 million in annual turnover, will be used to repay debts and possibly to repurchase company shares, the firm said last month.

Elsewhere, additional savings were announced last month when CSM said it would close four of its bakery ingredients distribution units in the US.

Slicing away nearly 150 jobs and bringing savings of about €60 million, the €2.8 billion firm announced plans to shut down BakeMark East centres in Buffalo, Saratoga, St Louis and New Orleans.

The head office of BakeMark East in Schaumburg, Illinois, will also close down.

But carving a bigger slice of European bakery ingredients market and a key factor in the ongoing drive to drill down into bakery supplies, CSM went on the acquisition trail in 2003: buying in June the bakery operations of Coberco Dairy Foods, outside The Netherlands, that had an annual turnover of €11 million.

And in May, 9500 strong CSM reached an agreement to acquire the bakery ingredients business of Unilever in Hungary. The transaction, valued at €5.1 million ($5.9 million), took effect from 31 May 2004.

In March 2004 the firm officially sealed the merger of UK bakery ingredients and finished foods firms, Arkady Craigmillar, Readi-Bake and Caravan Brill.

CSM bought Readi-bake, a subsidiary of Country Home Bakers with annual sales of €22 million, in 2003 for €28 million, giving the firm a step up into American-style cookies and sweet treats in the British market.

CSM claims to have a 12 per cent share of the European bakery ingredients and products market. The bakery ingredients unit, which covers a wide range of products including lactic acids and food preservatives sold mainly under the Purac brand, saw a slight drop in turnover for the first half of this year to €138.9 million.

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