Information on the Target

Established in 1929, Hafner Group has established itself as a prominent family-owned enterprise specializing in the fresh industrial pastry sector. The company offers a variety of products including cream pastries, pies, and éclairs, as well as ready-to-stuff pastries like pie crusts and puff pastries. Under the leadership of Nicolas Sesmat since 2012, Hafner has embarked on a comprehensive modernization of its industrial facilities alongside strategic acquisitions, successfully positioning itself as a key player in the market with three production sites located in the Loire, Savoie, and Yvelines regions, as well as a smaller manufacturing facility in Canada.

On July 28, 2021, Hafner announced the acquisition of Naturellement Gourmand, a strategic move expected to enhance Hafner's market presence significantly. This acquisition includes Naturellement Gourmand's subsidiary, Tartefrais, focusing on fresh pastries packaged under protective atmosphere, and another subsidiary, Les Délices du Chef, specializing in blinis, pancakes, and crêpes. The integration of these subsidiaries will not only position Hafner as the leading French company in its sector but also diversify its offerings and solidify its footprint in Western France, where Naturellement Gourmand operates two production plants in the Calvados and Morbihan regions.

Industry Overview in France

The fresh pastry industry in France is characterized by its rich culinary heritage and innovative products. With a robust demand for high-quality pastries, the sector has witnessed consistent growth fueled by consumer preference for fresh and artisanal products. The trend toward healthier eating and convenience has also encouraged manufacturers to explore innovative packaging solutions and the introduction of organic and dietary-specific options.

Western France, in particular, has become a focal point for pastry production, supported by an increasing number of artisanal bakeries and industrial manufacturers. The local markets benefit from a strong consumer base that values traditional pastry-making techniques while also embracing modern flavors and formats. This has created a ripe environment for expansion, particularly for companies looking to diversify their product lines and enhance their market offerings.

In recent years, sustainable practices and corporate social responsibility have gained traction in the food industry. As consumers become more environmentally conscious, companies are now prioritizing sustainability in sourcing ingredients and production processes. This growing awareness has prompted many enterprises within the pastry sector to adapt, ensuring they meet evolving consumer expectations while maintaining quality and taste.

Moreover, the competitive landscape in the French pastry market presents opportunities for consolidation. Companies that are able to leverage technology, innovation, and operational efficiencies are likely to thrive, particularly as larger players seek to strengthen their market positions through strategic acquisitions and partnerships.

The Rationale Behind the Deal

The acquisition of Naturellement Gourmand aligns seamlessly with Hafner's strategy to enhance its market leadership in the fresh pastry space. By incorporating Tartefrais into its operations, Hafner reinforces its position as the top French provider of fresh pastries, thereby capitalizing on a growing consumer demand for quality products.

Additionally, the move into adjacent product categories like blinis, pancakes, and crêpes not only diversifies Hafner's product offerings but also allows the company to harness the synergies between its existing products and those of Naturellement Gourmand. This strategic expansion is expected to bolster Hafner's revenue and facilitate further growth in a rapidly evolving market.

Information about the Investor

The funding for this transaction was facilitated by Cerea Mezzanine funds, which played a pivotal role in arranging junior mezzanine financing in addition to bank financing provided by LCL and Société Générale. Cerea Mezzanine is known for its strategic investments in mid-market companies and has extensive experience in the food sector, making it a well-suited partner for Hafner in this major acquisition.

This partnership underscores the investor's commitment to supporting companies that not only demonstrate growth potential but also value sustainability and social responsibility. By financing Hafner's acquisition, Cerea Mezzanine reinforces its portfolio with a company dedicated to modernizing its operations while adhering to CSR principles.

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The acquisition of Naturellement Gourmand by Hafner appears to be a sound investment decision. Given the growing demand for fresh pastries and innovative product offerings in France, the integration of Naturellement Gourmand's operations should enable Hafner to solidify its market leadership and achieve significant scale.

Furthermore, the diversification into adjacent categories positions Hafner to tap into new revenue streams, which is essential in today's competitive landscape. This strategic alignment suggests that the company is not only focused on growth but is also prepared to adapt to shifting consumer preferences.

Hafner's commitment to sustainability and social responsibility enhances the overall value proposition of this acquisition. As consumers increasingly favor brands that prioritize ethical practices, Hafner stands to benefit from this trend, promoting its enhanced environmental and employee-focused initiatives.

Overall, this deal reflects a strategic move toward long-term growth and resilience in the pastry sector, potentially yielding significant returns for both Hafner and its investors in the years to come.

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