Case Study

Post-merger Integration for Sweet & Savoury Snack Producer

Food & Beverage Industry, Lean Transformation

Production line of baking cookies, closeup

Situation

Private equity owned biscuit and snack manufacturer with revenues of €80m and EBITDA of >10%.

Company was the number 2 player in the CE market behind Mondelez.

Multiple sites in Eastern Europe, with a growth agenda driven both organically and by acquisition. 

  • Growth in all key markets
  • Reduction of Direct Labour costs
  • Reduction of Supply Chain costs

Approach

Three-stage approach, starting with operational due diligence to scope out the opportunity for improvement and design an appropriate approach.  Once the acquisition had taken place, support was provided for the post-merger integration and finally, site rationalisation took place.

  • Operational Due Diligence: a site visit and access to the data room provided essential input to the thesis and included upside from the customer-base and product portfolio and synergies with existing customers and products, gains from improved yields, re-engineered and more effective procurement of packaging and raw materials, productivity gains, overhead synergies and site rationalisation.  Value creation activities were structured in 2 phases: post-merger integration and site rationalisation.
  • Post-merger integration: as a carve-out, there was a limited timeframe in terms of such factors as sales and marketing activities, IT systems provision and maintaining data integrity.  The transfer of these activities was fast-tracked as a pre-requisite to building and maintaining traction in delivering against value creation objectives.  On transfer to the acquiror’s sales and marketing function, targeted actions on key products and customers ensured that revenue and margin objectives were met. Actions to put in place best-practice management operating systems and behaviours, drive operating efficiencies and deliver packaging and material savings were put in place immediately following completion of the acquisition.
  • Site Rationalisation: reduction of sites from 4 to 2, infrastructure works and transfer and commissioning of plant and equipment to support reduction of the footprint were project managed.  Further consolidation of the organisational structure and reduction in overheads completed this phase of the programme.

Results

40
%
Productivity Increase
50
%
Capacity increase
10
%
Packaging cost reduction

We have fundamentally changed the management culture & delivered well beyond the 5 year plan in the first 2 years

Biscuit Manufacturer

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