Rothschild & Co acted as lead financial adviser to ABF on its ~£15bn demerger of Primark and FoodCo to create two pure-play FTSE 100 businesses
Rothschild & Co is acting as lead financial adviser to Associated British Foods plc (“ABF”) on the proposed demerger of its Retail business, Primark, from its Food business (“FoodCo”) – a landmark transaction, which once completed, will likely represent the largest ever FTSE 100 retail demerger and the third largest FTSE 100 consumer demerger. The transaction will create the only pure-play FTSE 100 food producer alongside the largest pure-play FTSE 100 apparel retailer.
Rothschild & Co is advising ABF on all aspects of the demerger, including strategic options analysis, transaction structuring and execution, governance considerations and stakeholder engagement. The separation is expected to be effected by way of a dividend demerger, subject to customary approvals and tax clearances, with completion targeted before the end of 2027.
This mandate highlights Rothschild & Co’s deep experience advising on large and complex UK public company separations and transformational transactions, as well as its long standing expertise across the global consumer and retail sectors.
Following an in depth strategic review, ABF has decided to proceed with the separation, which will result in two independent, UK listed companies. Given their scale, it is anticipated that both entities will be constituents of the FTSE 100. Upon completion, ABF shareholders will hold shares in both Primark and FoodCo. Primark operates 486 stores across 19 markets with approximately £9.5 billion of annual revenues, while FoodCo is a diversified global food business operating in 52 countries with approximately £9.8 billion of annual revenues.
It is expected that a demerger will deliver a number of benefits to each business, in particular:
- Oversight by boards that are directly aligned to the industry dynamics and strategic priorities of the respective businesses;
- A clearer investment proposition and enhanced investor understanding; and
- Accountability to shareholders who are invested because of their specific interest in either FoodCo or Primark.
Akeel Sachak, Global Head of Consumer, Rothschild & Co, said: “This proposed demerger and landmark transaction represents a pivotal moment in the long and distinguished history of Associated British Foods and a compelling example of how thoughtful portfolio separation can unlock strategic clarity and long term value. Our role has been to support the Board through a rigorous review process and to help design a structure that enables both Primark and FoodCo to thrive as independent, focused businesses. The outcome reflects the strength and scale of both platforms and positions each to pursue its strategy with clarity, discipline and confidence.”
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For further information
Global Advisory, Rothschild & Co
Claire Gorman
Tel: +44 20 7280 1578
claire.gorman@rothschildandco.com
Brunswick
Ed Brown
Tel: +44 (0) 7823 527 181
ebrown@brunswickgroup.com
About Rothschild & Co, Global Advisory
Rothschild & Co is a family-controlled and independent group and has been at the centre of the world's financial markets for over 200 years. With a team of c.4,800 talented financial services specialists on the ground in over 50 countries, Rothschild & Co's integrated global network of trusted professionals provide in-depth market intelligence and effective long-term solutions for our clients in Global Advisory, Wealth & Asset Management, and Five Arrows, its alternative assets arm.
Global Advisory, a division of the Rothschild & Co group, designs and executes strategic M&A and financing solutions, providing impartial, expert advice to large and mid-sized corporations, private equity, families and entrepreneurs, and governments.
Through its unrivalled network of 1,650 industry and financing specialists in 48 countries, Rothschild & Co's Global Advisory business combines the breadth of its advisory offering with a high volume of transactions to achieve a unique understanding and perspective into markets and participants worldwide.
