The board of Aryzta has announced that it has unanimously rejected a binding takeover proposal of almost €0.75 per share from Elliott Advisors, a US private equity fund.

Elliott’s takeover offer had valued Aryzta at close to €735m.

Announcing its decision on Friday, the Aryzta board said that after careful review of the Elliott proposal, including the envisaged refinancing for Aryzta’s debt, it had decided unanimously to reject the proposal from Elliott.

Line in the sand

The announcement draws a line in the sand of one of the longest-running sagas in Irish business this year, after Elliott first made a takeover approach for Aryzta in the summer.

It will be interesting to see if Elliott now walks away from the table or whether it returns to the table in the new year and tries to force a hostile takeover of Aryzta, which is the only option remaining for the private equity group.

Strategic plan

Separately, the board of Aryzta also announced a two-part turnaround plan for the company and confirmed it will sell its bakeries in North America to focus solely on Europe and Asia. The company said it has received a “high number” of expressions of interests for various parts of its business around the world.

Aryzta said it expects to grow its earnings margins from 9% now to 12.5% in the next two years.

The group also expects a return to organic sales growth by 2023 and said it expects a 25% reduction in overhead costs by the end of next year.