A bid estimated at 1.2 billion euros

According to Oddo, the French food giant - which had previously shown interest in the company in 2020 before abandoning the deal due to the Covid-19 pandemic - has reportedly submitted an offer in the region of 2 billion Australian dollars, or approximately 1.2 billion euros.

In a research note released this morning, the brokerage highlights that Made Group is characterized by a vertically integrated model, covering production, part of the sourcing, packaging, and distribution.

A portfolio focused on healthy food

Founded in 2005, Made Group has positioned itself in the 'healthy food' segment with two flagship brands: Cocobella (coconut water and milk products) and Rokeby (high-protein dairy products).

The company also owns several secondary brands, including Impressed (pressed juices), NutrientWater (enhanced waters), and The Collective (Greek yogurts).

Regarding its capital structure, Coca-Cola took a 45% stake in 2018. In 2021, TPG Capital acquired a 60% majority stake in a transaction that valued Made Group at between 300 million and 350 million Australian dollars at the time.

An external growth strategy that makes sense, says Oddo

From the analysts' perspective, the acceleration of M&A activity is a positive development. It provides an opportunity for a market rerating for a group that remains on track to achieve resilient stock status.

The brokerage believes that a potential acquisition of Made Group - which would follow the recent purchases of KateFarm and Huel - would create a solid platform in the Asia-Pacific region for the dairy division, where Danone has historically struggled to expand due to local sourcing barriers.

While the firm acknowledges that the rumored valuation (representing an EBITDA multiple of 18x) could be justified by growth synergies, it remains cautious. It notes that the Huel brand had already been purchased at a premium, at nearly 30x its estimated EBITDA.

Market reaction

On the Paris Stock Exchange, Danone shares were up 0.4% at 64.7 euros this Monday morning after two hours of trading.

It should be noted that the stock goes ex-dividend today, with payment scheduled for Wednesday.