M&AInsightsFood Sector

*connectedthinking

2007

pwc

Analysis & opinions on M&A activity across Europe from our network of local advisers*

Neil Sutton Food Sector LeaderCorporate FinancePricewaterhouseCoopers LLP

Stephen OldfieldFood Sector LeaderBusiness Recovery ServicesPricewaterhouseCoopers LLP

Acquirers found much to get their teeth into in the food sectorlast year with the total value of food deals in Europe reachingv10.6bn. Margin pressures and capacity considerationscontinued to drive consolidation, particularly in the mid-market.

Food manufacturing may be a challenging sector, yet PrivateEquity (PE) houses – attracted by iconic brands, stable cashflows, the emergence of profitable niches and the less cyclicalnature of the sector – continue to seek investments, large and small.

PE firms led the flurry of mega-deals announced at the end of 2006, with the v2.4bn secondary buyout of United Biscuitsgetting 2007 off to an exciting start and setting the pace for an action-packed 12 months.

With a team dedicated to the food sector, PwC CorporateFinance is well-placed to identify industry trends and to assist

clients – particularly those in the highly-active middle market – in applying the most effective corporate strategies.

PwC Business Recovery Services have a specialist teamworking with food businesses throughout their supply chain,providing advice and assistance to help them address the areasof underperformance. The combined strength and depth of skills and experience within the PwC Corporate Finance andBusiness Recovery teams provides a formidable offering, withan increasing number of assignments requiring both teams to facilitate successful transactions.

This edition of Food M&A Insights presents just some of ourthoughts on this exciting industry and has something for largediversified food groups through to smaller specialist companies.As always, your feedback and responses are extremely valuable.We would welcome the opportunity to hear your views and todiscuss how the issues raised here might affect your business.

Welcome to Food M&A Insights, an annual review of M&A activity and key trends withinthe European food manufacturing sector, by PricewaterhouseCoopers. In addition to ourannual M&A analysis, this year’s edition explores several topical issues within the foodsector such as the impact of pensions liabilities upon transactions and the significantgrowth in functional and medical foods.

Welcome

1For more information visit our website at: www.pwc.com/foodinsights

A super-size market

Generally, the trend line for deal activity in the food sector followed that of the European M&A market as a whole. M&A volumes overalldecreased slightly from 9,788 deals in 2005 to 9,415 in 2006. Theaggregate value rose by 12.8% last year to total v803.5bn comparedwith v712.4bn in 2005.

The total value of M&A in the European food sector remainedconstant last year totalling v10.6bn compared with v10.5bn in2005. Deal volumes also remained constant at 348 transactions– on a par with 2005.

Source: dealogic, M&A Global

Food M&A Total European M&A

2001 2002 2003 2004 2005 2006

12000

10000

8000

6000

4000

2000

0

Num

ber

of E

urop

ean

Food

Dea

ls

Tota

l num

ber

of E

urop

ean

Dea

ls

280

290

300

310

320

330

340

350

360

370

380

European M&A activity by volume

Source: dealogic, M&A GlobalCriteria: Completed deals with a disclosed value only

Food M&A < v500m Food M&A > v500m Total European M&A (vbn)

2001 2002 2003 2004 2005 2006

14.0

12.0

10.0

8.0

6.0

4.0

2.0

0.0

900

800

700

600

500

400

300

200

100

0

Eur

opea

n Fo

od M

&A

(v b

n)

Tota

l Eur

opea

n M

&A

(v b

n)

European M&A activity by value

2

Buyers target the bottom line

This is evident in the largest deal completed in the European foodsector last year; Permira’s v1.73bn leveraged buyout of Unilever’sEuropean frozen food business. Permira plans to leverage value from the company’s strong brands, including Birds Eye and Iglo, and improve operational efficiency.

In second position was the v1.2bn acquisition of EAC Nutrition – the Denmark-based infant food business of the East Asiatic Company,by the listed Dutch company Royal Numico, Europe’s biggest maker of baby milk. The deal will enable Numico to also become a majormaker of baby food in Asia. Numico intends to focus the activities of EAC Nutrition on profitable growth in its core markets – China,Thailand and Malaysia. EAC Nutrition has a 17% share in volume terms in China, the largest nutrition market in Asia, which is expectedto grow at double-digit rates in coming years.

While food sector M&A simmered at the start of 2006, the pace reallyheated-up towards the end of the year with four deals totalling v7.9bnpending at the year-end.

The last quarter of 2006 saw the announcement of a v2.4bn secondarybuyout by Blackstone and PAI of United Biscuits – sold by Cinven andMidOcean Partners – and the v1.9bn acquisition by Nestlé, the world’slargest food group, of Novartis Medical Nutrition from the Swisspharmaceutical group Novartis. Nestlé has been focusing on foodnutrition in addition to its core operations in food staples.

Premier Foods followed up its v665m acquisition of Campbell’s UK & Ireland business with the proposed v1.8bn takeover of rival RHM to create the UK’s biggest food producer; while ICI agreed to sell Quest International Nederland, its flavours and fragrance business, to Givaudan of Switzerland, for v1.8bn.

Although often a challenging industry – particularly in terms ofrevenue growth potential – food manufacturing still has manyattractions. It generates stable cash flows, is less cyclical thanmany industries and there is often scope to take out cost andincrease profit margins.

3For more information visit our website at: www.pwc.com/foodinsights

Source: dealogic, M&A GlobalCriteria: Completed deals with a disclosed value only, acquired stake greater than 20%

Largest disclosed deals in the European food sector in 2006

On at least two of these deals pensions liability issues have requiredattention. At United Biscuits, the Transport & General Works Unioncalled for a cash injection from the buyers to fund the company’s£230m pension deficit. Similarly, Premier Foods recently agreed tocontribute more than £40m of extra cash into RHM’s pension fundeach year to help pay-off the scheme’s £120m deficit.

Nevertheless, once completed, these deals will be included in the dealdata for 2007, getting the year off to a flying start.

Completion Deal Bid Acquired Target Target Business Target BidderDate Technique Value (vm) Stake % Description Nationality

3-Nov-06 Divestment/LBO 1,725 100 Unilever plc & NV European frozen food business UK Permira Ltd (IBO)

3-Jan-06 Divestment 1,207 100 East Asiatic Co Ltd A/S Infant food business Denmark Koninklijke(EAC Nutrition division) Numico NV

8-Sep-06 Divestment 830 100 United Biscuits ( UK) Ltd Spanish and Portuguese Spain Altria Group Inc(Spanish and Portuguese biscuit operations (Kraft)operations)

15-Aug-06 Divestment 665 100 Campbell Soup Co Manufacturer of ambient foods UK Premier Foods plc(UK and Irish businesses)

8-Aug-06 Divestment/LBO 458 100 Sara Lee Corp European meat business Netherlands Smithfield Foods Inc & Oaktree Capital Management LLC

4

The pensions dynamic

So what has changed?

The fact that pension liabilities can impact materially upon the viability and pricing of many deals has proved particularly problematic in the foodmanufacturing sector. Alongside the United Biscuits and RHM examples, in the mid-market UK dairy producer Dairy Crest has agreed to acquireFrench peer company Saint-Hubert from UK food manufacturer Uniq forv370m. The deal requires a proportion of the purchase proceeds to beused to pay off Uniq’s pension deficit. The treatment of the £143m deficitin Arla UK’s pension scheme has only recently been resolved concerningits takeover by Arla Amber, its Danish parent co-operative.

Pensions can no longer be considered as contingent liabilities. Deficits mustnow be treated as any other unsecured creditor with pension trustees actingto protect the interests of the pension creditors. Both the trustees and theRegulator are interested in anything which might detrimentally affect thepension creditor. While M&A activity does not, in itself, fall foul of thisrequirement, a number of its consequences may impact negatively upon the position of the pension creditor, for example:

• A change in the priority of creditors – for example where debt raised tofinance the deal is subject to fixed and floating charges therefore potentiallydiluting the position of the pension deficit as an unsecured creditor

• Return of capital – for example where sale proceeds are used to finance a share buy back or unusually large dividend therefore reducing the overallassets of the group

• Change in control – a change in the control structure of an employer whichmay reduce the overall employer covenant

• Dilution of employer covenant – the impact of leveraged transactions on thenet cash available to address a pension deficit and future service accruals

Where adequate measures to mitigate the negative impact upon the pensioncreditor are not taken then the Regulator has the ability to use anti-avoidancepowers. These can relate either to the company concerned, or individualdirectors party to the deal.

The Regulator has recently announced that the Pension Protection Fund Levy payable by companies with defined benefit schemes is due to double.This will have a negative impact upon the profitability and liquidity of those companies.

Anyone considering the sale or purchase of a company with a UKdefined benefit pension scheme must be fully aware of any potentialpension liability problems before embarking on the transaction.

The UK Pensions Act 2004 came into force in April 2005establishing the Pensions Regulator. Its remit is to protectdefined benefit pension schemes, particularly in circumstanceswhere a funding deficit exists.

5For more information visit our website at: www.pwc.com/foodinsights

Impact on deals

Consideration must be given to the impact of the proposed disposal on the pension scheme trustees. This applies particularly in respect of cash – the impact of leveraged transactions on cash to address any funding deficit and secure future service accruals; and security – the impact of acquisition debt on the position of the pension scheme as an unsecured creditor. In addition, multi-employer regulation exists,which means that the full scheme buy-out value relating to employeesbeing transferred on disposal of a subsidiary may be triggered. Most importantly, sellers need to engage the trustees, understand their powers and, in most cases, seek regulatory clearance for proposed actions.

For buyers, pricing is critical. The starting point is to consider whatimpact the pension deficit has on the valuation of the company and the likely cost of future service accruals. Buyers need to understandwhat agreements are in place with the trustees and consider whetherthe deal provides an opportunity to agree future scheme funding.

The UK Pensions Act 2004 enables the corporate veil to be lifted withthe Regulator holding the powers to impose penalties. Private Equityfunds and overseas investors could therefore be a target for theRegulator. The potential may exist for the Regulator to seek financialredress from the investors behind special purpose acquisition vehicles,however this has yet to be tested.

The best way to mitigate the regulatory and investment risk associatedwith the acquisition of a business with a material pension deficit is to seek clearance from the Regulator, based on the submission of a plan agreed with the trustees. Clearance can be sought prior to orindeed after the transaction. The most appropriate strategy will dependon the circumstances surrounding the deal. The overall message is thatthe pension issue should be factored into the price and expert adviceshould be taken early on.

While pensions can be an M&A minefield, the PricewaterhouseCooperspension solutions team has deep knowledge of the new regime, the Regulator’s approach and the potential impact on specific dealsituations. The team has a great deal of experience in working withcompanies in the run up to transaction or flotation situations, advisingon how to mitigate pension risks and also reduce pension costs anddeficits in order to facilitate productive negotiation.

Sellers must be aware of the pensions dynamic in deals and must research fully their pension scheme position beforethey start the transaction process. It can then be consideredas an integral part of the disposal process and strategy.

6

Snacking on smaller deals

The four largest mid-market transactions completed during the year all involved financial buyers. Top of the list is the v458m sale of Sara Lee’s European meats business to a joint venture betweenSmithfield Foods and Oaktree Capital Management. This was followedby the LBO of HJ Heinz’s European seafood business by LehmanBrothers, the IBO of Corporación Alimentaria Penasanta by AhorroCorporación Desarrollo Quercus Equity and the investment inRichmond Foods by Oaktree Capital Management, for v425m, v300m and v266m, respectively.

The frozen and functional food segments were particularly active lastyear. On the frozen front, UK ice cream producer Richmond Foods was bought by Oaktree Capital Management in a v266m publictakeover and Greece’s Delta Ice Cream acquired by Nestlé for v240m. The largest deal in the functional foods segment was in France with the v220m MBO of Nutrition & Santé SA backed by ABN Amro and L Capital Partners.

It has been another healthy year for European M&A in the mid-market(deals between v50m and v500m) with v5.3bn-worth of mid-sized dealscompleted in the European food segment compared to v4.7bn in 2005.

Source: dealogic, M&A GlobalCriteria: Completed deals with a disclosed value only, acquired stake greater than 90%

Top ten deals under 1500m in the European food sector in 2006

Completion Deal Bid Acquired Target Target Business Target BidderDate Technique Value (vm) Stake % Description Nationality

8-Aug-06 Divestment/LBO 458 100 Sara Lee Corp European meats business Netherlands Smithfield Foods Inc & Oaktree Capital

20-Mar-06 Divestment/LBO 425 100 HJ Heinz Co European seafood business France Lehman Brothers

28-Mar-06 Divestment/LBO 300 100 Corporación Alimentaria Milk producer Spain Ahorro CorporaciónPenasanta SA-CAPSA Desarrollo Quercus

Equity (IBO)

9-Jun-06 Public offer 266 100 Richmond Foods plc Frozen confectionery UK Oaktree Capitalproducts manufacturer Management LLC

31-May-06 Divestment 240 96 Delta Ice Cream Co SA Ice cream manufacturer Greece Nestlé SA

17-Feb-06 Divestment 220 100 Nutrition & Santé SA Dietary foods manufacturer France ABN Amro & L Capital Partners (MBO)

2-May-06 Negotiation 188 100 Laurens Patisseries Ltd Chilled desserts manufacturer UK Bakkavor Group hf

13-Dec-06 Swap 170 100 Ewico SP Z oo, ZPT Olwit Vegetable oil manufacturer Poland Zaklady TluszczoneSp Z oo, Olwit-Pro Sp Z oo Kruszczowe SA

15-Mar-06 Divestment 169 100 Carapelli Firenze SpA Olive oil producer Italy SOS Cuetara SA

31-Oct-06 Divestment/LBO 127 100 Whitworths Ltd Dried fruit, cereals, nuts, rice, rusk, UK European Capitalstuffings and sugars producer

7For more information visit our website at: www.pwc.com/foodinsights

Organic

2000 2001 2002 2003 2005

500

400

300

200

100

02004

Reb

ased

con

sum

er e

xpen

ditu

re

FunctionalFree-from

Growth in specialised food markets

Source: dealogic, M&A Global

† Source: Mintel report, Functional Foods –UK, Market Intelligence, March 2006

Functional and medical foods go mainstream

Functional foods are generally defined as those that provide healthbenefits beyond their nutritional value. Medical or ‘free-from’ foods, on the other hand, have had certain ingredients removed becausethose ingredients are common causes of allergies. The two segmentsoverlap in soya which, although an allergen to some, serves both as a substitute to milk and as a food with several health benefits beyondits nutritional value.

Over the course of the last five years, functional foods have movedfrom a specialist niche of the health-food market to the mainstream.Mintel† estimates that up to 40% of households now consumefunctional foods. The explosive growth in demand for ‘free-from’ foods has resulted from a fashion for excluding foods from the diet,often after the ‘self-diagnosis’ of food intolerances. Growth has alsobeen stimulated by new product development (NPD), particularly in the convenience sector, which provides those who pursue a ‘free-from’diet with greater choice.

With growing consumer concern over health and well-being and a rapid increase in food allergies and intolerances (both real andperceived), functional and medical foods have achieved some ofthe highest growth rates in the food sector over the last five years.Coupled with high margins, they have attracted interest from a range of multinational food groups.

8

So far, the functional foods market has been dominated by a few largecompanies; notably Danone, Unilever, Yakult and Alpro. The medicalfood market has generally been more fragmented but contains a fewlarge players, such as Heinz, with its Bi-Aglut subsidiary. Their position,however, is being challenged by the launch of cheaper, own-brandproducts by the large multiples, making it tougher for new entrants.

The most spectacular growth, albeit from a low base, has been in soyaproducts. The 700% increase can be attributed to greater awareness of the health benefits of soya, its use as a low-fat alternative to dairyproducts and NPD that has greatly expanded the range of soyaproducts on shelves, making them more appealing.

The greatest opportunities now appear to lie in products which lendthemselves to the addition of functional ingredients but where there arefew, if any, existing players. In collaboration with Benecol, PepsiCo nowincludes cholesterol-reducing plant stanol esters in its Tropicana freshorange juice, providing further options to consumers who wish to lowertheir cholesterol.

Last year saw ten functional/medical food deals in Europe, eight ofwhich involved trade players only.

Functional and medical food deals in the European food sector in 2006

Source: dealogic, M&A GlobalCriteria: Completed deals, acquired stake greater than 20%

Completion Target Target Target Business Bidder BidderDate Nationality Description Nationality

11-Dec-06 Haldane Foods Ltd UK Meat & dairy-free food & beverage manufacturer Hain Celestial US

3-Oct-06 Acatris Health BV Netherlands Develops & produces botanical ingredients for the Frutarom Israelfunctional foods & dietary supplements markets Industries Ltd

13-Sep-06 Aminostar sro Czech Republic Producer of dietary supplements Walmark AS Czech Republic

23-Jun-06 SoFine Foods Belgium Producer of soya products Vandemoortele BelgiumInternational BV (Alpro)

22-May-06 Epax AS Norway Producer of concentrated Omega-3 EPA/DHA oils Ferd Private Equity (MBO) Norway

21-Mar-06 Natudis BV Netherlands Producer of a range of wholefoods, including gluten Koninklijke Wessanen NV Netherlandsand lactose-free products

4-Mar-06 Pro-Fibe Ltd UK Supplier of functional and processed foods, Glanbia Plc Irelandsports nutrition, animal nutrition, health products and nutritional supplements

3-Mar-06 Sports Direct Ltd UK Manufacturer of nutritional products for sportsmen Atlantic Grupa doo Croatia

22-Feb-06 Nutrition et Sante France Producer of functional foods, slimming products, ABN Amro & L Capital Francesports nutrition and other nutritional specialities Partners (MBO)

1-Feb-06 Semper AB Sweden Producer of baby food and gluten-free products Hero AG Switzerland

9For more information visit our website at: www.pwc.com/foodinsights

The health-conscious future

More stringent rules from the EU regarding health and nutrition claims will require companies to provide scientific evidence tosupport these claims. In addition, the backlash against genetically-modified products, trans-fats and artificial colours has so far nottouched functional foods. A key lesson, perhaps, is to avoiddeveloping functional additives that do not already exist in a natural form where possible.

The entrance of the large multiples to the sector will drive salesgrowth but may lead to falling prices and margins. This is likelyto encourage the acquisition of smaller players by the large,diversified food companies seeking premium products.

10

2004 2005 2006

UnitedKingdom

CEE France Spain Germany OthersBenelux Scandinavia Italy

70

60

50

40

30

20

10

0

Num

ber

of d

eals

Food deals by selected European locations

Source: dealogic, M&A Global

Central and Eastern Europe tops the menu

Despite this, Western Europe including the UK, France, Spain,Germany, Benelux, Scandinavia and Italy still accounted fornearly 71% of Europe’s total food sector deal volume last year.

The increased deal flow in CEE is explained by the high growth and consolidation opportunities available in the region alongsideincreasing diversity and greater political and economic stability.Food manufacturers are also following major customers – suchas Tesco – into CEE markets, including Russia, and looking at the opportunities of outsourcing production to this relativelylow-cost region.

Central and Eastern Europe (CEE) moved ahead of the UK to becomethe most active European market for food sector M&A.

11For more information visit our website at: www.pwc.com/foodinsights

Acquisitions Exits

200520042003 2006

Num

ber

of d

eals

0

10

20

30

2001 2002

40

50

60

70

80

Food deals involving PE and other fund investments

Source: dealogic, M&A Global

Private Equity

The UK and Benelux were the two most active investment arenas in Europe last year despite a drop in the number of UK-based dealsduring 2006. Secondary buyouts remain popular, in many casesdelivering good returns for the exiting investor and perpetuating PE involvement in the sector.

Food manufacturing has been a challenging sector for some PE investors, yet unquoted equity capital still continues to playan important role in the market. PE firms and other investmentfunds accounted for 74 buy-side food transactions and 29 exitsin Europe last year.

12

The capacity pendulumWhere over-capacity exists in the food manufacturing sector, retailershave greater ability to dictate prices and cause margin pressures.

Capacity rationalisation can not only reduce the level of competition butcan also lead to improved margins through greater efficiency in sectors,where price increases are traditionally difficult to attain. Last year sawthe closure of Northern Food’s Trafford Park bakery, while Young’smoved its chilled seafood production from Hull to Grimsby with the loss of around 550 jobs. 2006 also saw the closure of Grampian Country Food’s pork processing unit at Elmswell, due to rising costs and cheap imports.

A good example of capacity imbalance is the UK’s meat and livestockindustry. The main issue is to ensure there is sufficient primaryproduction (ie livestock) to meet abattoir demands. In general, however,UK primary producers are only marginally profitable. The situation is nothelped by EU subsidies – these used to be based per animal but arenow per acre and UK livestock production is consequently decreasing.

This impacts consumer choice: will they be prepared to sacrifice theUK’s proven high standards of quality – particularly in terms of health & safety and humane killing methods – for cheaper, imported meatwhich can have more uncertain provenance and quality standards. We have seen that many UK consumers are not prepared to pay extrafor transparency and traceability, and therefore the UK’s abattoir andkilling facilities are at risk since, as expensive, fixed structures, they arenot easily adapted to change. The UK meat industry is currently fightingthis threat through a campaign to raise consumer awareness of thebenefits of eating locally sourced produce.

Organic food is another sector on the capacity pendulum, with highermargins on offer for many manufacturers in a sector where supply is struggling to keep up with fast growing consumer demand. However, suppliers should be aware of a potential overreaction. In 2001, as a result of too many milk suppliers shifting to organicproduction, over a third of UK organic milk produced went into theconventional dairy market at significant losses. Since then organic milkproduction levels have been falling and consumption rising (by 45% in 2006) and the market has moved towards a more balanced position.

13For more information visit our website at: www.pwc.com/foodinsights

Outlook for 2007:Heavy diet of deals – Given the weight of pending deals at the end of last year, 2007 is likely to be a bumper year for food sector M&A. A ‘softlanding’ had been expected by many but the M&A market remains robustdespite the continuing competitive pressures on manufacturers.

Consolidation – M&A will continue with consolidation driven by capacityimbalances and retail pressure. Accessing higher growth, higher marginniches – such as organic, ethical, premium branded and ethnic foods –will lure acquirers; and fragmented sectors, such as the snacking andconfectionery market, are likely to experience consolidation.

Labelling – Government policy and growing consumer health awarenesswill continue to encourage food manufacturers to adopt clear foodlabelling policies although disagreements remain about which method to adopt. Major manufacturers have proposed their own schemes – the ‘guideline daily allowance’ (GDA) of sugar, fat and salt contained in a product, while the UK government has recommended a ‘traffic light’ system.

Functional and medical foods – Nutrition and health claims will have to be supported by ‘generally accepted scientific data’ in accordance withnew EU regulations. This is likely to impact products with unsubstantiatednutritional claims or those with lower levels of nutritional benefit than arecurrently communicated.

Price and quality correlations – Although consumers are increasingly well-informed, they are often less willing to spend a higher proportion of their income on food. This has given rise to an increase in the ‘quality-price correlation’ with increased consumer pressure for retailers to deliverpremium quality products at ‘cost leadership’ prices. As manufacturersgrapple with this challenge, there is the opportunity for some to gain acompetitive advantage by producing products which demonstrate betterconsumer understanding. Investment in innovation, clear labelling and thepromotion of genuine ‘functional benefits’ can all help drive sales growth.

Pension obligations – The role of the Pensions Regulator continues toevolve as seen by recent changes to the Pension Protection Fund Levy.The importance of dealing with final salary pension schemes as part of a deal strategy is likely to require up-to-date thinking and proactive actionin order to prevent the deal being delayed or failing.

Environmental concerns – Reducing ‘carbon foot-prints’ will be asignificant commercial consideration as high-end consumers continue to push for, and base their purchasing choices on, product ‘provenance’and method of transportation. Local sourcing and seasonality will become more important at the premium end of the food market as will other eco-aspects such as bio-fuels and soya production.

Private Equity – Private Equity funds are active in all food sectors and ifcurrent debt multiples are maintained it is likely there will be a continuedflow of deals helping sector multiples remain high. With fundraising at an all-time high and the increase in new entrants into the market, we seeno downturn in PE related M&A activity. This is likely to fuel competition in the sector and potentially force further consolidation, as PE housesconsider their exit strategies, which are most likely to be throughsecondary buyouts and IPOs.

This publication includes information obtained or derived from a variety of publicly available sources. PricewaterhouseCoopers has not sought to establish the reliability of these sources or verified such information.PricewaterhouseCoopers does not give any representation or warranty of any kind (whether express or implied) as to the accuracy or completeness of this publication. The publication is for general guidance only and does notconstitute investment or any other advice. Accordingly, it is not intended to form the basis of any investment decisions and does not absolve any third party from conducting its own due diligence in order to verify its contents.Before making any decision or taking any action, you should consult a professional advisor.

PricewaterhouseCoopers accepts no duty of care to any person for the preparation of this publication, nor will recipients of the publication be treated as clients of PricewaterhouseCoopers by virtue of their receiving thepublication. Accordingly, regardless of the form of action, whether in contract, tort or otherwise, and to the extent permitted by applicable law, PricewaterhouseCoopers accepts no liability of any kind and disclaims allresponsibility for the consequences of any person acting or refraining to act in reliance on this publication for any decisions made or not made which are based upon the publication.

PricewaterhouseCoopers (www.pwc.com) provides industry-focused assurance, tax and advisory services for public and private clients. More than 130,000 people in 148 countries connect their thinking, experience andsolutions to build public trust and enhance value for clients and their stakeholders.

Important notice for US residents: In the US, corporate finance services are provided by PricewaterhouseCoopers Corporate Advisory & Restructuring LLC. PricewaterhouseCoopers Corporate Advisory & Restructuring LLC isowned by PricewaterhouseCoopers LLP, a member firm of the PricewaterhouseCoopers Network, and is a member of the NASD and SIPC. PricewaterhouseCoopers Corporate Advisory & Restructuring LLC is not engaged in thepractice of public accountancy.

PricewaterhouseCoopers may from time to time send you information about its products and services, events and newsletters that may be of interest to you. If you do not wish to receive this, please contact Kumud Rawal at kumud.rawal@uk.pwc.com

© 2007 PricewaterhouseCoopers. All rights reserved. "PricewaterhouseCoopers" refers to the network of member firms of PricewaterhouseCoopers International Limited, each of which is a separate and independent legal entity.

For further information, except for US residents, please contact:

United Kingdom Neil Sutton +44 207 213 1075 neil.sutton@uk.pwc.com

Rest of EuropeBelgium Jean-Yves De Vel +32 2 710 4093 jean-yves.de.vel@be.pwc.comCzech & Slovak Republics Geoff Upton +42 0 5115 1225 geoff.upton@cz.pwc.com Denmark Michael Eriksen +45 3945 9271 michael.eriksen@dk.pwc.comFrance Noël Albertus +33 1 56 57 8507 noel.albertus@fr.pwc.comGermany Werner Suhl +49 69 9585 5650 werner.suhl@de.pwc.comGreece Emil Yiannopoulos +30 210 687 4640 emil.yiannopoulos@gr.pwc.comHungary Margaret Dezse +36 1 461 92 20 margaret.dezse@hu.pwc.comIreland Aidan Walsh +353 1 662 6255 aidan.walsh@ie.pwc.comItaly Marco Tanzi Marlotti +39 02 80 646 330 marco.tanzi.marlotti@it.pwc.comNetherlands Joris van de Kerkhof +31 20 568 5264 joris.van.de.kerkhof@nl.pwc.comPoland Olga Grygier +48 22 523 4422 olga.grygier@pl.pwc.comRussia Steven Berger +7495 967 6325 steven.berger@ru.pwc.comSpain Julian Brown +34 91 568 4723 julian.brown@es.pwc.comSwitzerland Heinz Hartmann +41 5 8792 1544 heinz.hartmann@ch.pwc.com

Asia PacificChina John Layburn +86 1065 337009 john.layburn@cn.pwc.comSingapore Benjamin Kan +65 6236 3998 benjamin.kan@sg.pwc.com

North AmericaCanada Keith Mosley +1 416 941 8307 keith.mosley@ca.pwc.com

For US residents requiring information on corporate finance related services, please contact our registered NASD BrokerDealer within the US, PricewaterhouseCoopers Corporate Advisory & Restructuring LLC, which can be contacted directly at:USA Rakesh Kotecha +1 312 298 2895 rakesh.r.kotecha@us.pwc.com

For advice on European Private Equity deals, please contact:United Kingdom Chris Hemmings +44 207 804 5703 chris.hemmings@uk.pwc.com

For advice on Business Recovery Services within the food sector, please contact:United Kingdom Stephen Oldfield +44 207 804 1475 stephen.m.oldfield@uk.pwc.comUnited Kingdom Ian McConnell +44 289 024 5454 ian.mcconnell@uk.pwc.com

For advice on Pension Solutions, please contact:United Kingdom Louise Inward +44 207 213 1003 louise.inward@pwclegal.co.uk

For advice on Transaction Services within the food sector, please contact:United Kingdom Geoff Eversfield +44 207 804 4371 geoff.eversfield@uk.pwc.com

For more information visit our website at:

www.pwc.com/foodinsights