PANRICO

Panrico is one of the largest Iberian bakery companies, focusing mainly on the pastries and sliced bread categories. Owners of popular brands such as ‘Panrico’ and the ‘Bollycao’, it has a well established consumer base with extensive distribution networks and good growth prospects.

The decision of its owners to sell attracted much attention with a heavily subscribed auction process. Apax Partners was able to differentiate itself from its competitors to win what was an attractive investment.

“(…) most importantly I felt they did a good job of developing a relationship with the owner. With family business successions, if the owner does not get the feeling he was placing the company in good hands, he would not sell”, CEO Joan Cornudella.

This achievement was particularly impressive given the historic reluctance of Spanish family-owned businesses to sell to foreign investors: indeed, the Panrico deal represented the first such sale of a Catalan family-owned business.

Backed by Apax Partners and guided by a jointly agreed business plan, the existing management team set about realising the businesses’ growth potential. The initial strategy pursued was investment in product innovation to leverage on existing customers and distribution networks. There were also initiatives put in place aimed at cutting costs and increasing efficiency. As part of that process, the company’s exports business as well as its businesses in Greece and China were sold to increase the focus on the Iberian market.

“The next step was to ensure a focus on that (business) plan and to speed up the process of execution of the plan. There was also a focus on cash flow and efficient use of capital. These are the areas where I feel their strength lies and that stems from a rational, efficient approach to decision making”, CEO Joan Cornudella.

These efforts are paying off with the company on course to hit its target of €1bn in revenue and €200 million in EBITDA by 2010. This should be aided by acquisitions planned for the future as well as its aims to develop the brand globally.

“Profits are now up and we have been successful in executing the business plan. We are doing very well for the present but I feel what we have also achieved is setting a solid basis for future growth. Apax came in with a very high standard in terms of planning execution and decision making that has influenced much of the processes in the business”, CEO Joan Cornudella.

Apax Partners displayed the determination and relationship skills to win a highly coveted investment with good growth prospects. Through investment in product innovation and initiatives aimed at improving efficiency, the company is on course for growth in Iberia and beyond.