Apax books 5x on Tnuva(2)

The UK-based firm will offload the Israeli food business for about $2.5bn to Bright Food Group.

Apax Partners has agreed to sell its 56 percent stake in Tnuva, one of Israel’s largest food companies, to Bright Food Group, a food and agriculture business in China, according to a statement.

Financial details of the transaction were undisclosed, but the enterprise value was approximately $2.5 billion, according to a source familiar with the matter. The divestment, which is subject to regulatory approvals, will yield Apax a 5x return, the source added.

Apax declined to comment beyond the statement.

Apax ran a dual-track exit process for Tnuva, exploring both a local listing as well as a sale to a strategic buyer, the source added.

Tnuva’s operations cover the production, distribution and marketing of a wide range of food products, including dairy, frozen vegetables and pastries, poultry, beef and eggs.

Apax bought the stake in Tnuva in 2008, using its Apax European Fund VII, an €11.2 billion 2007-vintage. Under Apax’s ownership, the company committed over NIS 1.4 billion (€290 million, $400 million) in capital expenditure for modernisation, innovation and further growth, Apax said.

The group’s revenue increased by approximately 4.37 percent last year to NIS 7.17 billion, up from NIS 6.9 billion in 2012. This was mainly due to increased sales in all lines of business, Tnuva said in a statement in March.

Apax is currently investing its Apax Fund VIII, which closed on $7.5 billion last June.