Compass Group has agreed to purchase Fazer Food Services from family owned FMCG major Fazer Group for an enterprise value of approximately €475m ($537.55m).
The acquisition is currently subject to EU Commission competition approval. The company will finance the transaction using cash and existing credit facilities.
Of the total value, the initial cash consideration is estimated to be €420m and the remaining deferred consideration will be payable within seven years.
The deal will further strengthen Compass Group’s existing offerings, as well as allow it to create more innovative solutions for its clients and consumers.
Compass Group CEO Dominic Blakemore said: “Fazer Food Services is a highly regarded food service business in the Nordic region, and like Compass, is focused on high-quality food, culinary innovation, sustainability and great customer service.
“I am excited that, together with our existing colleagues in the region, we will be able to further enhance our customer proposition in the Nordic market.”
Fazer Food Services offers catering services to customers across various markets including business and industry, education, healthcare, seniors and defence.
The company operates more than 1,000 restaurants across the Nordic region serving around 500,000 meals per day.
It has operations in Finland, Sweden, Norway and Denmark with approximately 7,000 employees.
Fazer Group president and CEO Christoph Vitzthum said: “We believe Compass will provide a great home for Fazer Food Services.
“It is a leading food services business with a global reach and a strong purpose. Our two companies share similar values with a clear focus on food, outstanding customer service and a commitment to people.
“Whilst we are sad to see many of our colleagues leave Fazer Group to join Compass, we believe this acquisition will allow Fazer Food Services to achieve its full potential.”
Compass Group operates in around 45 countries with 600,000 employees serving more than 5.5 billion meals annually to customers.
In November, Compass Group reported organic revenue growth of 5.5% to £23.24bn for the year ending 30 September 2018.