Ownership has that Australian flavour again

Peters Ice Cream is back in Australian hands after Swiss food giant Nestle agreed to sell the time-honoured brand to a local private equity firm. Pacific Equity Partners has beaten a raft of rival bidders to Peters, which was acquired by the Swiss group in the mid-1990s.

While the price was not disclosed, Peters is believed to have had an enterprise value, including its debt, of $300 million to $400 million.

Industry sources said the brand was profitable and could have "long-term value growth of 5 to 7 per cent per annum".

Peters, which was founded early last century, makes well-known ice-creams such as Billabong, Choc Wedge, Frosty Fruits and Monaco Bar.

Shaw Stockbroking analyst Scott Marshall questioned whether the brand's growth rate was as high as some sources said.

"If you are a multinational company with manufacturing operations in several countries and you have $1 billion to spend and are watching growth declining in one of your markets, what would you do," Mr Marshall said.

"If I was in that position, I would be winding down in the slower market and chasing the higher growth in Asian markets, like China for instance, which has more than 300 million consumers."

Pacific Equity, which is based in Sydney, will also acquire a long-term licence to market in Australia some global Nestle-owned ice-cream brands such as Drumstick, Heaven and Maxibon.

The deal means Nestle no longer owns any refrigerated brands in Australia after previously selling its yoghurt and frozen meal businesses to Simplot.

The company will takeover Peters' Mulgrave factory, where the ice-creams are made, and continue to employ all 500 Peters staff.

A Nestle spokeswoman rejected speculation it was selling Peters because of the increasing pricing pressure supermarkets were applying to manufacturers of branded items.

Source: Herald Sun, 30 June 2012