No comment from Aryzta on reported plans to sell off troubled US arm

Swiss-Irish food company Aryzta has declined to comment on a report that it plans to sell off its underperforming US business as part of a restructuring of the group.

According to a report on the Swiss news website themarket.ch, Aryzta plans to sell its US arm, which holds major contracts with quick-serve chains such as McDonald's and Subway, while retaining the Canadian part.

The baked goods specialist was being advised on the transaction by investment bank Rothschild, the report said, citing market sources.

Rothschild was hired by Aryzta in May to carry out a strategic review of the business, the results of which have not been made public.

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A spokesman said the company did not comment on “speculation”.

Aryzta has been struggling to halt a decline in earnings, particularly in the US, and negative investor sentiment towards its complex capital structure.

Dissident shareholders led by Swiss group Veraison and Aryzta's largest investor Cobas are trying to oust the current board in a bid to reverse the decline.

Both sides are set for a showdown at an extraordinary general meeting (egm) in Switzerland next month.

Unsolicited approaches

Aryzta, which owns the Cuisine de France label here, said last month it had received unsolicited approaches from several parties interested in taking over the group.

The company has lined up Andreas Schmid, the former head of Swiss-Belgian chocolate giant Barry Callebaut, to replace Gary McGann as chairman.

Investor advisory group ISS has recommended shareholders back the company's proposed replacement for Mr McGann, but has accused the company of doing too little to tackle its various problems.

In an advisory ahead of the egm, ISS said the company’s dissident shareholders had “made a compelling case that the current board has been tackling the company’s challenges with too little urgency”.

ISS is recommending shareholders back the company's proposed replacement for Mr McGann and vote to keep chief executive Kevin Toland and chairwoman of the remuneration committee Annette Flynn, the company's preferred candidates, on the board.

But it is also recommending shareholders back the election of Veraison candidates Urs Jordi and Heiner Kamps as independent candidates to the board.

Aryzta shares are down nearly 80 per cent since 2018. An €800 million capital raise and more than €400 million worth of asset sales have not been enough to halt the decline and prompt a turnaround.