The deal would see Aryzta acquire 49% of Picard, a French premium food business for €446.6m. It will be largely funded with the net proceeds from their recent sale of Origin shares, where last week they sold circa €400m, net of fees and taxes.

Picard specializes in breads, pies, and deserts and had a turnover of €1.37bn last year. Its March 2015 EBITDA run-rate is €192m and the company is valued at €2.25bn. Over the last 40 years they have grown to become a branded market leader in France.

Picard would be treated by Aryzta as an associate and would be expected to make a net contribution of 3% to underlying EPS on an annualised basis, offsetting half of the negative 6% impact of the Origin placement. Picard will be separately managed and separately funded with debt nonrecourse to Aryzta. Aryzta would have two seats on the Picard board.

Aryzta also has the option to acquire the remainder of the company in three to five years time.

Commenting on the investment Owen Killian CEO of Aryzta said: “The investment in Picard is consistent with our strategy of consumer relevancy through diversifying markets and channel positioning. Picard is a highly predictable business and an ideal replacement for Aryzta’s Origin holding, allowing the company strategically move up the value chain.”