After two and a half years of negotiations, Public Acquisition Offers (OPA), and agreements, The Gilinski Group has officially signed the transfer of control of the Nutresa Group, a company it acquired following a series of takeover bids and an agreement with the Antioquian Business Group, GEA.
The Gilinski family will transfer control of the multinational food company to a firm affiliated with the royal family of the United Arab Emirates, which will subsequently be passed to IHC Capital Holdings, the partner company with which they initiated the takeover bids on GEA companies. LR has obtained documentation showing the approvals from competition authorities for this move, valued at around US$11 billion.
Following share exchanges and debt adjustments, The Gilinski Group is expected to retain 12% of Nutresa and approximately US$4 billion.
The transactions have already received approval from the competition authorities in various countries, according to senior executives from GEA. Jaime Gilinski is expected to chair the Board of Directors of Nutresa, while his son Gabriel will maintain a position on the board.
It is important to note that following the Madrid Agreement, which concluded the disputes between GEA and the Gilinskis, 96.9% of Nutresa’s shares were held by the Cali family, with 2.45% owned by the Emiratis.
Changes within the Company
The market anticipated that new developments could arise in the company after changes to the Board of Directors and the announcement made by the company itself regarding offers for some of its business units.
In June, two new members joined the Board of Directors: Peter Abraam and Ravi Thakran, who will remain on the board until the end of the current statutory period, concluding on March 31, 2025.
Abraam has held CEO and senior executive roles, and has been IHC’s director of strategy and growth since 2020; he is also the Chairman of Arena, a global leader in events, and a member of the Board of Directors of Hellenic Initiative.
Thakran has previously served as the Chairman of LVMH Moët Hennessy Louis Vuitton Group Asia; he is the Founder and Partner of Turmeric Capital; he has also been a Board Member of Harrods London, Executive Chairman of Wheels Up USA, Director of the Singapore Tourism Board, and Trustee of the Global Conservation Corps.
A month prior, in May, it was reported that the administration had received proposals from several significant international companies interested in acquiring key segments of the holding company.
In the document accompanying the last takeover bid, the possibility of the Gilinski Group divesting from certain divisions of the multinational food company was discussed.
Multinational companies like Nestlé, Mars, Bimbo, and Mondelēz are actively purchasing in the region, and some are interested in a company that has a higher valuation when segmented.
What is Nutresa?
The recent developments now place one of the leading food traders in Latin America in the hands of the Arabs.
Nutresa is a familiar presence in the daily lives of Colombians, often without their knowledge. Under this conglomerate, brands such as Zenú, Pietrán, Jet, Ranchera, Tosh, Festival, Crem Helado, Colcafé, Doria, and restaurants like El Corral and Leños & Carbón are included. Overall, according to company figures, it commands a 50.2% share of the processed food market in the country.
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Its business units encompass meat, biscuits, chocolates, ice cream, and consumer foods, with several categories in which it holds more than half of the market share, surpassing multinational giants such as Nestlé and Mondelēz.
The company operates as a true multinational with a direct presence from the north to the south of the continent, being present in 17 countries and generating $40 of every $100 earned each year through international sales.
In its coffee line, Nutresa sells more in the United States than in Colombia, while Mexican buyers remain interested in the holding company’s cold cuts business unit.
But its interests are not limited to food. Nutresa also has investments in companies like Novaventa, which is vital for its digital logistics.
The Gilinski Group’s Transfer of Control Over Nutresa: Key Insights and Market Implications
After a dynamic two and a half years filled with strategic maneuvers, Public Acquisition Offers (OPA), and agreements, The Gilinski Group has successfully finalized the transfer of control of the Nutresa Group. This acquisition has completed a series of takeover bids and negotiations with the Antioquian Business Group (GEA), reshaping the landscape of the food industry in Latin America.
The Gilinski Group will now pass control of the multinational food staple to an entity associated with the royal family of the United Arab Emirates. This transfer will then be handed over to IHC Capital Holdings, a partner company integral to initiating the takeover bids on GEA properties. Stay informed of this landmark move valued approximately at US$11 billion, which has received the green light from competition authorities.
Post-transaction, The Gilinski Group is expected to retain a 12% stake in Nutresa, amounting to around US$4 billion after accounting for share exchanges and balanced debts. The operations have secured approval from various competition authorities, as confirmed by senior GEA executives. Notably, the Board of Directors for Nutresa is set to be chaired by Jaime Gilinski, with his son Gabriel also remaining actively involved.
This pivotal transition is historically significant, considering that following the Madrid Agreement—which resolved disputes between GEA and the Gilinskis—96.9% of Nutresa’s shareholding was predominantly under the control of the Cali family, with only 2.45% attributed to the Emiratis.
The Moves Within the Company
Expected changes within Nutresa have sent ripples through the market, especially following recent adjustments to the Board of Directors and the company’s acknowledgment of offers for selected business units.
Two new members joined the Board in June: Peter Abraam and Ravi Thakran, marking a strategic shift that extends until the statutory period concludes on March 31, 2025. Both members bring extensive experience that signals a progressive transformation for the company.
Profiles of New Board Members
- Peter Abraam: A seasoned executive with a history of leadership positions, Abraam serves as the director of strategy and growth at IHC since 2020. He chairs Arena, a global events leader, and contributes to the Hellenic Initiative.
- Ravi Thakran: Former Chairman of LVMH Moët Hennessy Louis Vuitton Group Asia and founder of Turmeric Capital, Thakran also holds significant roles as a Board Member at Harrods London and the Executive Chairman of Wheels Up USA.
News in May indicated Nutresa’s management had received considerable proposals from key international firms expressing interest in acquiring important segments of the company.
Furthermore, the last takeover bid’s documentation hinted at the possibility of The Gilinski Group divesting portions of Nutresa’s divisions. Notably, multinational giants like Nestlé, Mars, Bimbo, and Mondelēz have shown interest, especially as the company gains even more valuation when segmented.
Understanding Nutresa and Its Market Presence
As one of Latin America’s premier food conglomerates, Nutresa is embedded in the daily lives of millions, often without their knowledge. This company encompasses a plethora of iconic brands including Zenú, Pietrán, Jet, Ranchera, Tosh, Festival, Crem Helado, Colcafé, and Doria, not to mention renowned restaurants such as El Corral and Leños & Carbón. According to internal figures, Nutresa commands a remarkable 50.2% market share in processed foods across Colombia.
Market Segmentation and Performance
Nutresa’s extensive portfolio includes diverse business units such as:
- Meat Products: Leading in both domestic and international markets.
- Biscuit and Snacks: Continues to outperform competitors from diverse multinational corporations.
- Chocolate and Ice Cream: A favorite across various Latin American countries.
It is also noteworthy that Nutresa has a firm grasp over international sales, with approximately $40 of every $100 earned deriving from its overseas performance. Within the coffee segment, Nutresa has outstripped local sales, offering increased traction in markets like the United States, while maintaining strong interest in Mexico for its cold cuts division.
Strategic Implications for Nutresa
The transition of control over Nutresa to IHC underscores a multifaceted strategy poised to enhance shareholding dynamics and overall company performance. With significant international interests emerging, Nutresa may explore further divestments and joint venture opportunities to capitalize on emergent markets.
Benefits of the Transition
- Diverse Management Expertise: Introduction of seasoned leaders such as Abraam and Thakran brings fresh perspectives to Nutresa’s governance.
- Increased Market Presence: Integrating with UAE-based partners opens up new regional market frontiers.
- Dynamic Business Strategy: Potential for new collaborations with international firms could yield growth in critical sectors like cold cuts and processed foods.
Future Considerations
The evolving structure within Nutresa invites investors to observe potential segmentation strategies that align well with the shifting consumer preferences. Additionally, with the possibility of divestiging certain units, there may be increased competition among multinationals aiming to stake their claim in a burgeoning market.
Closing Insights
The uncertain and transformational nature of this acquisition keeps Nutresa in the spotlight. Stakeholders need to stay vigilant; this transition heralds both opportunities and challenges that will ripple through the Latin American food industry.
