PAI sells biscuit manufacturer as fund close looms

The Paris-based firm has sold United Biscuits together with Blackstone for more than £2bn

The Blackstone Group and PAI Partners have agreed to sell United Biscuits, an international biscuit maker, to Yildiz Holding, a Turkish food manufacturer, according to a statement.

Financial details of the deal were undisclosed, but according to a market source, the pair sold the company for more than £2 billion (€2.56 billion, $3.2 billion).

PAI and Blackstone declined to comment beyond the statement.

United Biscuits is a leading manufacturer and marketer of biscuits in the UK and second largest in the Netherlands, France, Belgium and Ireland. Among the business’ brand names are McVitie’s, Penguin, go ahead!, McVitie’s Jaffa Cakes, Jacob’s, Jacob’s Cream Crackers, Twiglets, Mini Cheddars and Carr's in the UK, and BN, Delacre, Verkade and Sultana in Continental Europe. It owns and operates 16 manufacturing facilities of which seven are in the UK.

PAI and Blackstone bought the business in 2006 for £1.6 billion. PAI made the investment using its PAI Europe IV, a €2.7 billion vehicle from 2005, while Blackstone used capital from its Blackstone Capital V, a $21.49 billion 2006-vintage. 

Nearly two years ago, the pair sold a part of United Biscuits, called KP Snacks to Düsseldorf-based food group Intersnack for around £500 million, a source told PEI in December 2012.

The exit comes as PAI is close to wrapping up fundraising, according to a source familiar with the matter. It is understood the firm has so far collected approximately €2.8 billion for its Fund VI, which is targeting €3 billion. The vehicle held a €1.4 billion first close in January.

PAI has already put some of the capital from its successor vehicle to work; in April, PAI agreed to acquire a majority stake in Euro Media Group (EMG), a production business based in France, for just under €200 million.

In the same month, PAI and The Carlyle Group entered into exclusive talks with French-based Schneider Electric to acquire its business unit Custom Sensors & Technologies. The pair will pay about $900 million for a majority stake in the business, PEI reported at the time.