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Food group Granarolo eyes M&A in U.S. after buying British unit

By Reuters

By Francesca Landini

MILAN (Reuters) -Italian dairy group Granarolo aims to grow through acquisitions and is looking at opportunities in the United States, where it needs a base to help expand its cheese business, Chairman Gianpiero Calzolari told Reuters.

The food group on Monday said it had taken complete control of its British distributor, Granarolo UK, adding this deal would open the way to further M&A activity in the coming months.

In the last few years the group has increased its milk production and is now looking for new markets outside Italy.

The United States could be an interesting market for Granarolo’s hard cheese specialties, including parmigiano reggiano and grana padano, which are protected designation of origin.

“The idea is having a company overseas that makes local products and acts as platform to sell specialties we make in Italy,” Calzolari told Reuters in a phone interview.

The group, which has Italy’s largest bank Intesa Sanpaolo among its investors, could also make acquisitions in other European countries or even in Italy, Calzolari said.

The group does not exclude a future bourse listing, but the option is not on the table in the short-term, the chairman said.

Last year the group posted revenue of 1.28 billion euros, down 3% year-on-year due to the pandemic. Sales in foreign markets accounted for more than one-third of total revenue.

On Monday Granarolo said it had bought the 49% of Granarolo UK it did not own in a move to strengthen its footprint in Britain.

“We think we can boost Granarolo UK sales to 100 million euros by around 2024 from 60 million euros in 2020,” he said.

Granarolo currently accounts for more than 10% of all the dairy products Italian food producers sell in Britain and 8.8% of Italy’s global dairy exports.

($1 = 0.8231 euros)

(Reporting by Francesca Landini; Editing by Kirsten Donovan and Steve Orlofsky)