Patties Foods accepts $232m acquisition bid from Pacific Equity Partners

Australia-based Patties Foods has agreed to an acquisition bid of approximately $232m from Pacific Equity Partners (PEP).

PEP approached the maker of Four ‘n Twenty pies and Nanna’s frozen desserts with a takeover offer of $1.65 per share, which values the Australian company at $231.8m.

Patties has entered into a scheme implementation agreement with PEP as per which the private equity firm can purchase a 100% stake.

Directors of Patties have unanimously suggested that shareholders vote in favour of the offer, which may provide shareholders with tax benefits as the per share offer includes a $0.25 special dividend.

Patties chairman Mark Smith was quoted by abc.net.au as saying: "Whilst the board remains confident in management’s plans for growth and innovation in the core brands and the business is experiencing strong momentum, the scheme represents an attractive value for shareholders."

The deal also has the approval of Patties’ Rijs family, which owns a 36.6% stake.

PEP’s managing director David Brown was quoted by the website as saying: "We acknowledge the very important role Patties Foods plays in the local community at Bairnsdale and we look forward to supporting that ongoing relationship."

The takeover will be made in cash but Patties shareholders can retain their shares in the company. The scheme will be put up for shareholder voting in late August.

In 2015, Patties had to issue a recall of several frozen berry products due to food safety scare.