Lotus plans acquisition of Dutch gingerbread firm

Peijnenburg occupies more than 60 per cent of the total market for gingerbread in the Netherlands, and has helped to ensure that the nation's gingerbread segment has become a growing market.

In comparison with Belgium and France, which are two countries that also have a 'gingerbread tradition', the per-capita consumption in the Netherlands is up to six times higher.

Peijnenburg was already a traditionally important brand in the Netherlands, but has reinforced and expanded this position even further during recent years. Peijnenburg has given gingerbread a modern image by, among other things, investing in the marketing of handy single-piece packages and special products for children.

Peijnenburg markets virtually all its products under its own brand names: Peijnenburg and Wieger Ketellapper. Both brands are well recognised.

The intended acquisition of Peijnenburg will therefore be a significant strategic step for the Lotus Bakeries Group. In the Netherlands, Lotus Bakeries is building a strong position as brand manufacturer of specialities.

In the Netherlands, the Peijnenburg brand will be retained, supported and further expanded. The Lotus Bakeries Group wants to reinforce its sustainable growth and profitability by concentrating on baked confectionery products such as caramelised biscuits, waffles, frangipane and galettes.

Furthermore, Lotus Bakeries plans to pursue a brand policy with products that it believes are distinctive, driven by effectively targeted marketing campaigns. The intention to acquire Koninklijke Peijnenburg is therefore a good fit.

This takeover was put into action when Lotus Bakeries acquired all the shares in Koninklijke Peijnenburg.

Lotus and Happen Naar, the holder of all the shares in Koninklijke Peijnenburg, have conducted exclusive negotiations about the takeover. The acquisition is now the subject of the statutory consultation procedure.

The enterprise value that will be paid as the acquisition price will be approximately seven times EBITDA. The acquisition will be fully financed by an unsecured bank loan to be repaid over seven years.

Koninklijke Peijnenburg is the market leader in the Netherlands for gingerbread products. There was a management buy-out in 2000, in which Gilde Participaties and the company's management bought the shares from the Peijnenburg family.

Peijnenburg's consolidated net sales, which are realised almost exclusively in the Netherlands, amounted to €46.5 million with an EBITDA of €10 million in 2005.

The Peijnenburg headquarters are located in Geldrop (near Eindhoven, the Netherlands) where part of the production is also manufactured. The second manufacturing unit is established in Sint Johannesga (near Zwolle, the Netherlands). Peijnenburg has a total of 211 employees.

. Lotus Bakeries achieved sales of around €18 million in the Netherlands in 2005.