Research Update: Processed Meat Producer Group of Butchers And Proposed Debt Assigned Preliminary 'B' Ratings; Outlook Stable

We forecast Group of Butchers (GoB; group top holding company Artisan Holdco B.V.), a Dutch private-label meat processing company specialized in sandwich meat and ready-to-eat meat products, will generate revenue of close to €600 million and S&P Global Ratings-adjusted EBITDA of about €65 million in 2022. The group benefits from its premium positioning, close links to large local retailers, ability to quickly offset most raw materials cost inflation, and efficient operations, but is constrained by its modest scale of operations in niche (but expanding) product segments, high geographical concentration in the Netherlands, and reliance on a few large retail customers. GoB is planning to issue a new €330 million senior secured term loan B (TLB) and a new €50 million

...- We forecast Group of Butchers (GoB; group top holding company Artisan Holdco B.V.), a Dutch private-label meat processing company specialized in sandwich meat and ready-to-eat meat products, will generate revenue of close to 600 million and S&P Global Ratings-adjusted EBITDA of about 65 million in 2022. - The group benefits from its premium positioning, close links to large local retailers, ability to quickly offset most raw materials cost inflation, and efficient operations, but is constrained by its modest scale of operations in niche (but expanding) product segments, high geographical concentration in the Netherlands, and reliance on a few large retail customers. - GoB is planning to issue a new 330 million senior secured term loan B (TLB) and a new 50 million senior secured revolving credit facility (RCF) to refinance its current debt structure and fund two acquisitions. - For 2022 and 2023, we project S&P Global Ratings-adjusted debt leverage of about 5.5x-6.0x, assuming the group...

Research Update