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Spanish olive oil bottler Deoleo agrees to sell company to private-equity firm

CVC Capital closes deal with manufacturer of Bertolli and Carbonell at €0.38 a share

The board of Spanish olive oil bottler Deoleo has agreed to sell the company to private-equity firm CVC Capital Partners, ending months of speculation about its future. CVC has offered to buy the company for €0.38 a share, which values the company at €439 million.

The offer – which had originally been rejected by two of the savings banks with a stake in Deoleo, CaixaBank and Kutxabank – was accepted by Bankia, which holds 16.5% of the company’s shares, and BMN, with 5.8%. The latter two banks are obliged to sell their stakes given that they have been bailed out with taxpayer funds.

The fund is also likely to implement a capital increase of €56 million, also at €0.38 a share, which would see it control a 29.99% stake in the firm. Once that operation is complete, CVC will launch a takeover bid for the rest of Deoleo.

Deoleo is in debt to the tune of €472 million as a result of a series of badly timed acquisitions

Deoleo, which makes household brands such as Carbonell and Bertolli, is in debt to the tune of €472 million as a result of a series of badly timed acquisitions. It accounts for 22% of the global olive oil market, and last year saw €20 million in profit from revenues of €813 million.

Among the company’s stakeholders, the farmer’s cooperative Hojiblanca, which owns 10% of the company, was the only dissenting voice with regard to the CVC deal. Savings banks Unicaja, CaixaBank and Kutxabank gave the green light to the deal. Spanish participation in the company may be limited to the latter two lenders in the future, with Hojiblanca likely to leave the group.

According to company sources, the private-equity fund has committed to developing the brand in foreign markets, in particular in the United States and Asia. CVC is prepared to keep the headquarters of the company in Spain, and to maintain – at least for five years – its brands, including Koipe and Carbonell in Spain, and Bertolli and Carapelli in Italy.