Brait to buy stake of Iceland Food

JSE-listed Brait's investment is part of a deal in which the management of Iceland, a British entrepreneur, and a retailer from the Middle East are investing in Iceland Food.

As a result of the deal, Walker has succeeded in taking the supermarket chain private after recently signing an exclusivity deal with the winding-up board of Landsbanki, the failed Icelandic bank that is the majority owner of the supermarket chain.

Walker's bid had been also backed by Dubai-based Landmark Group and Graham Kirkham, founder of the DFS Furniture Group retail chain.

The acquisition valued the business at £1,45bn before transaction costs, Brait said on Friday. It said the buyout was backed by an £860m all-senior debt package funded by Credit Suisse, Deutsche Bank, HSBC, Nomura and Royal Bank of Scotland, as well as a £250m vendor loan note.

"The equity funding has been provided by existing senior management acquiring 43%, with the remaining equity acquired in equal proportions by Brait," said Lord Kirkham, who also founded the Landmark Group.

Brait's investment in the food group, which Walker founded with his business partner, was its first venture into a European retail group.

It was also Brait's first move since December to spend the R1,7bn cash pile it had on its balance sheet.

"The group, which consists of value food retailer Iceland Foods, discount frozen food retailer Cooltrade and frozen food exporter Itex, continues to invest heavily in frozen food innovation, launching over 200 new products in the past year, " Brait said.

Source: Business Day