Target Information

FnB Private Equity has successfully executed two simultaneous acquisitions of France Aligrain and Coustenoble, aiming to establish a comprehensive animal nutrition group with a presence in both specialty stores and Hypermarkets and Supermarkets (GMS). While both companies offer similar products, specifically formulated seed blends, they cater to distinct yet complementary customer bases. Coustenoble, established almost a century ago, primarily operates within specialized retail and garden centers, whereas France Aligrain predominantly serves GMS and DIY stores.

The target companies focus largely on customers who are bird owners, whether amateur or professional, as well as those that keep poultry, rodents, rabbits, and small carnivores. These acquisitions, launched at the end of last year, proceeded seamlessly despite the COVID-19 lockdown, with both companies showing no impact from the crisis and remaining on track with their annual budget. The newly formed group is projected to achieve revenues exceeding €25 million in the current fiscal year.

Industry Overview in France

The animal nutrition market in France is characterized by a growing demand for high-quality products as consumers become increasingly aware of the nutritional needs of their pets. The trend towards premium pet food and specialty diets has driven innovation in the industry, prompting manufacturers to develop products that cater to specific dietary requirements.

Moreover, the rise of pet ownership in France, along with a growing interest in birds and small animals, has further fueled the sector's growth. The diverse and expanding demographic of pet owners translates to a robust market for animal nutrition products, especially those that leverage natural ingredients and health-conscious formulations.

As consumer behavior shifts towards sustainable and ethically sourced products, companies in the animal nutrition industry are increasingly adopting practices that align with these values. This transition not only enhances brand loyalty but also positions companies favorably within a competitive marketplace.

In response to these industry dynamics, firms that have a dual focus on specialty retail and major distribution channels, like the newly formed group from the acquisitions, are uniquely positioned to capitalize on current trends and consumer demands.

Rationale Behind the Deal

The rationale for FnB Private Equity's dual acquisition lies in the complementary nature of France Aligrain and Coustenoble's customer bases and distribution channels. By merging these companies, FnB intends to create a more balanced and diversified portfolio that can better serve a wider audience in the animal nutrition sector.

This strategic consolidation also aims to strengthen market share in a competitive landscape, enabling the company to leverage synergies in operations and marketing. Furthermore, as the group plans to expand through additional acquisitions in the next 24 months, consolidating existing resources is key for a more effective growth strategy.

Investor Information

FnB Europe Fund SLP, established in 2017, is an investment fund focused on small and medium-sized enterprises (SMEs) in the French agri-food sector and neighboring regions, including the UK, Benelux, Spain, Italy, and Portugal. The fund actively invests in majority stakes in the transmission and spin-off of large corporations, leveraging their industry experience for strategic support.

The FnB team boasts extensive experience within the agri-food industry, which facilitates active engagement with portfolio companies. Their involvement encompasses both financial backing and operational guidance, addressing a range of challenges that SMEs may encounter. Recent team enhancements include the addition of Blaise Duaut as General Secretary and Chief Financial Officer, contributing to the fund's robust management capabilities.

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The acquisition of France Aligrain and Coustenoble by FnB Private Equity appears to be a favorable investment. The strategic fit of the two companies complements FnB's ambition to build a leading player in the animal nutrition space while addressing diverse customer needs. Combining their distribution channels allows for enhanced brand visibility and access to multiple market segments.

Additionally, the resilience shown during the COVID-19 pandemic underscores their operational stability, indicating sound management and a resilient business model. With a projected revenue growth trajectory, the new group is likely to experience significant financial success in the upcoming years.

However, the investor should be mindful of the competitive landscape and the need for continuous innovation to meet evolving consumer preferences. The focus on sustainability and quality will be paramount in ensuring sustained growth and market relevance in the long term.

Overall, with the right expansion strategy and operational integration, this investment has the potential to deliver robust returns while positioning FnB as a leader in the dynamic animal nutrition market.

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