Elliott Returns With $890 Million Aryzta Bid to Pressure Board

Elliott Management Corp. bid 794 million francs ($890 million) for Aryzta AG, putting pressure on the Swiss baker’s board to consider a sale.

Paul Singer’s investment firm made an offer at 80 centimes per share, the same level as an initial proposal that management had rejected. The move adds further impetus to a saga that took an unexpected twist last month when Chief Executive Officer Kevin Toland abruptly left the company.

Aryzta said its board will study the conditional offer, which is 10% higher than Friday’s closing price. The shares rose as much as 7.1% to 77.6 centimes in Zurich Monday.

Elliott has financing from seven banks, Bloomberg reported earlier, citing people familiar with the matter. The financing commitments expire if the board doesn’t agree to a binding deal by midnight Dec. 8, according to the people, who declined to be identified because the information isn’t public.

Aryzta, which supplies buns to McDonald’s and makes Otis Spunkmeyer cookies, ended negotiations with Elliott in October and has been working with advisers to explore asset disposals, including one announced Monday to sell a North American pizza business to Brynwood Partners.By making a binding offer, Elliott is pushing Aryzta’s board to discuss the proposal with investors. Urs Jordi, recently installed as chairman, has publicly said he doesn’t want to sell.

“Elliott would have to do the same things as us: focus, slim down and simplify,” Jordi told Swiss newspaper Finanz und Wirtschaft in an interview Friday. “The difference would be that today’s shareholders could no longer profit from it.”

The firm, once worth more than $9 billion, has lost over 90% of its value since 2014.

Aryzta also said Monday that Chief People Officer Tony Murphy and John Heffernan, commercial director for its North American business, ceased their roles with immediate effect and won’t be replaced. The company said that’s part of the restructuring plan announced Dec. 1 that aims to make management more agile.

©2020 Bloomberg L.P.

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