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Hitt og þetta 12. apríl 2006

(IFN) FL Group leads consortium in EUR461M Refresco buy

Reykjavik (IFN) Icelandic investment company FL Group Wednesday said a consortium it is leading has signed an agreement to acquire Refresco Holding B.V., the Dutch private label soft drink manufacturer from the investment fund 3i Group Plc for a total consideration of EUR461 million.

FL Group will become the largest shareholder in the company with a 49% holding.

Among other investors are Vifilfell hf. and the key management of Refresco.

FL Group's investment totals EUR56 million, paid in cash.

The acquisition is subject to the approval of the competition authorities in Germany.

Refresco employs 1,200 people across five countries and is recognised as the second largest manufacturer of private label fruit juices and soft drinks in Europe.

The company's key markets are Germany, France, Spain, Portugal, the Netherlands and Finland, where Refresco's main customers are leading European service retailers and hard discounters.

Refresco's primary business involves the manufacture of private label fruit juices and other soft drinks as well as contract-manufacturing for international A-Brand companies.

Refresco also manufactures under its own label. In 2005 the company generated gross sales of EUR606 million and earnings before interest, tax, depreciation and amortization of EUR64.1 million.

Refresco has performed strongly in recent years, out-performing the market, growing by 10% a year between 2000 and 2004, FL Group said.

According to the management consulting company Booz Allen Hamilton the European market grew by around 4% annually, whilst growth for private label was around 8% for the same period.

It is anticipated that the business will continue to grow and expand its operations.

Over the next few years it is estimated by BAH that the market for Refresco's main sectors will grow by 6% to 8% as a result of the markets continuing to witness an increase in consolidation amongst service retailers and the rising market share of hard discounters in Europe.

One key area of potential expansion for Refresco is the fact that consumers are increasingly demanding healthy drinks and convenient packaging, an area in which the company has been a leading developer.

Kaupthing Bank hf. Investment Banking advised on the acquisition of Refresco.

Refresco is a well run company that has grown rapidly and profitably in recent years both by means of organic and acquisitive growth and today it is recognized as one of the largest and also one of the foremost drinks manufacturers of its kind in Europe," said Hannes Smarason, chief executive of FL Group.

"It has an excellent management team in place who enjoy a solid reputation and who have been prominent and continue to play a key role in this sectors' development," he said.

"In addition to Refresco's very strong technical knowledge and expertise the business has been a leading player in the development of packaging and new innovative products," Smarason said.

"The Refresco investment reflects very well FL Group's strategy of diversifying investments which potentially offer a number of attractive growth opportunities and we look forward to working with the management team in the future growth of the business," he said.

"Following the growth of our clients, innovation and geographic expansion is key to the future of the business," said Refresco Holding CEO Frans Barel.

"FL Group and the other investors fully support this strategy. The presence of Vifilfell, a bottling company in drinks and juices, furthermore illustrates the understanding and commitment to our business. The new investors also bring an excellent outreach to new markets. Refresco's management explicitly emphasizes their unrelenting commitment to the company, the strategy for growth and their clients and suppliers," Barel said.

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Sources: Dow Jones Newswires; www.icex.is; Vidskiptabladid

Icelandic Financial News (IFN) is available on Factiva, a joint venture between Reuters and Dow Jones Newswires, FT.COM, LexisNexis, Comtex, Gale and Thomson via the Nordic Business Report.