Private equity firm Lindsay Goldberg has reached an agreement to acquire the North American business of Schlieren, Switzerland-based Aryzta AG for $850 million.

Aryzta North America provides bread, sweet and savory baked foods, and snacks to customers in the quick-service restaurant, foodservice and retail markets across the United States and Canada. The company’s portfolio includes both private label and branded offerings under the Otis Spunkmeyer, La Brea Bakery and Oakrun Farm Bakery brands. Aryzta North America operates 15 production facilities with more than 4,000 employees in the United States and Canada.

Lindsay Goldberg says it has “deep familiarity and a successful history with much of the ANA business, having built and sold a predecessor to ANA in 2010.”

“ANA is one of the leading suppliers of high-quality baked goods in the US and Canada, and we look forward to partnering with management to continue ANA’s tradition of serving millions of consumers,” says Russell Triedman, managing partner of Lindsay Goldberg.

Eric Fry, partner at Lindsay Goldberg, adds, “We are excited to partner with the ANA management team as they execute their strategy to drive growth and create value for their customers by building on the company’s tradition of exceptional customer service and leading product innovation.”

The private equity firm focuses on partnering with families, founders and management teams seeking to actively build their businesses. Since 2001, Lindsay Goldberg has raised more than $17 billion of equity capital and has invested in more than 50 platform companies and over 250 follow-on opportunities.

The pending sale of the North American business comes a little more than three months after Aryzta’s management announced plans to dispose of businesses in both North America and Latin America and shift focus to Europe and Asia-Pacific (APAC) markets. As part of that strategy, Aryzta in early December 2020 sold its take-and-bake pizza business in North America to Great Kitchens Food Company, Inc., a newly-formed portfolio company of Greenwich-based private equity firm Brynwood Partners VIII LP.

“This is an exciting step in the evolution of our market-leading business and brands, and a strong endorsement of the hard work and commitment of our talented employees,” says Tyson Yu, chief executive officer of ANA. “Lindsay Goldberg is renowned for its collaborative approach in partnering with management teams to build great businesses. The firm’s extensive industry experience, network of relationships and broad operational expertise position us to maintain the highest standards for food safety and sustainability and accelerate our innovation and future growth trajectory.”

Urs Jordi, chairman and interim CEO of Aryzta, says the sale of the North American assets represents “a significant inflection point for Aryzta and vindication of our simplification strategy to the outright sale option.”

“I want to thank our shareholders and stakeholders for their confidence and support since September, which enabled this transaction to materialize,” he says. “Today’s transaction delivers significant debt reduction and balance sheet strength. It now allows us to focus on delivering further operational improvements and returning to organic growth. The agreed price reflects well on the underlying quality of the North American businesses, its assets, the significant recovery in performance achieved by the team and bodes well for its future performance prospects under its new owners.”

In a March 15 update on financials for the first half of fiscal 2021 ended Jan. 31, Aryzta says underlying EBITDA totaled €124.8 million ($148.7 million), down 27% from €169.8 million in the first half of fiscal 2020. Net revenues were €1.29 billion ($1.53 billion), down 22% from €1.66 billion a year ago.

Despite the year-over-year declines, Aryzta says performance is ahead of expectations, primarily reflecting the benefit of cost reductions through simplification of the business model and reporting structure and a strong recovery in North American operations. In addition, quick-service restaurants and retail channels recovered strongly in North America and recovery continued in Rest of World during the period, Aryzta said.

Offsetting the gains in North America were COVID-19 related disruptions in Europe, especially in the second quarter due to the impact of lockdowns and restrictions across the region and the resultant negative impact on the foodservice channel.

“Today’s results highlight the significant progress achieved as a result of our strategy to simplify the business and to de-risk the balance sheet with the sale of our North American business for $850 million,” Jordi says. “The progress to date validates the overwhelming shareholder vote for change in September and December 2020 and the renewed board’s decision to reject the proposal to sell the entire business. We can now focus on delivering the necessary operational improvements and returning to organic growth as we leverage the significant broad bakery experience to improve shareholder returns. Delivery of our targets will ensure we rebuild trust and credibility with investors, lenders, customers, suppliers and employees as both are in need of repair after years of disregard.”