Grupo LALA, S.A.B. de C.V. announced that its Board of Directors, with the favorable opinion of its Audit and Corporate Practices Committee, has agreed to propose to LALA's shareholders the acquisition of up to 100% of the shares of Vigor Alimentos, S.A. ("Vigor"), a Brazilian dairy company, and directly or indirectly, 100% of the shares of Itambé Alimentos, S.A. ("Itambé"), also a Brazilian dairy company, for an implied value of R$5,725 million (the "Transaction"). Considering a consolidated 2017 estimated EBITDA of R$329 million, the multiple of the Transaction is 17.4x.
As a first step towards completing the Transaction, LALA, FB Participações and JBS S.A. entered into a share purchase agreement pursuant to which LALA will acquire, subject to its terms and conditions, 91.99% of the shares of Vigor.
In addition, as part of the Transaction, LALA may acquire from Arla Foods International A/S ("Arla") an additional 8% of Vigor's shares, increasing LALA's participation to 99.99%.
Finally, the Transaction contemplates LALA's acquisition, directly or indirectly, of up to 100% of the shares of Itambé, subject to the exercise of certain rights by Vigor's partner, Cooperativa Central dos Produtores Rurais de Minas Gerais Ltda. under their existing shareholders' agreement.