DAVY VIEW

ARYZTA has agreed to dispose of its Brazilian assets to Grupo Bimbo. While no transaction details were disclosed, we estimate a sale price of c.€100m (c.6x EBITDA). Following completion of the disposal – anticipated during Q2 2022 – the group will be in a net cash position before lease liabilities and the hybrid bonds. Total gearing, including hybrids, of c.6.5x (FY 2022E) will likely prompt further capital stack reorganization. Supply chain and input cost inflation remain near-term headwinds, which will necessitate pricing recovery and the acceleration of internal productivity (margin) programmes.