More speculation as Findus tackles debt burden Published: 03 January, 2012
THE Findus Group, which owns Young’s Seafood, was at the centre of renewed speculation this weekend with the news that it was in “crunch talks” over its mounting debt problems.
The Sunday Times business section said the group could be forced into a painful restructuring as it tried to renegotiate loans of some £700-million, adding that Findus’s private equity owners Lion Capital tried but failed to raise capital last year by attempting to sell part of its French business to rivals Birds Eye. It also said that it had asked to waive a quarterly covenant test at the end of last year. Lion Capital paid £1.1 billion for the Findus Group, including Young’s, in 2008 in a deal which included high interest payments. In 2010 servicing debts cost the company over £110million. In October it was reported that Lion Capital was looking at possible plans to restructure the group. Findus told the Sunday Times that it was confident its measures to tackle the debt problem would succeed. Meanwhile, Young’s which employs more than 3,000 people, mostly in Grimsby and Scotland, has returned to profit with a surplus in 2010 of £7.4-million on a turnover of just more than £345-million. Since then the company has signed up star chef Jamie Oliver in a move which is expected to further boost sales. In November last year it also bought the troubled Cumbrian Seafoods company which has a large and highly modern chilled fish factory at Seaham in County Durham and, more importantly, with a number of important supermarket contracts.This acquisition, along with the need to rationalise costs, could see major restructuring this year with an impact on jobs. In fact this has already started with a number of redundancies announced at its Norfolk-based Cromer Crab Company business just before Christmas.