McDonald’s Buns Maker Is in a Kitchen Nightmare
Aryzta’s new management team needs its $911 million of fresh capital, but still has to prove its worth.
The Swiss company that makes McDonald's burger buns was worth 6 billion euros in 2014. Now, it's worth one-eighth of that.
Photographer: Andrey RudakovInvesting in Aryzta AG, the Swiss baking giant, has been a recipe for disaster over the past few years. The maker of goods ranging from McDonald’s burger buns to Otis Spunkmeyer cookies has issued three profit warnings in 18 months, and now wants to sell 800 million euros ($911 million) of shares to strengthen its balance sheet. Think of it as the opposite of self-raising finance.
After a period of over-expansion, lost contracts and rising raw material and labor costs, a new management team has been struggling to turn round the business. These efforts have been hampered by escalating debt. The shares have been falling for four years now, pushing the market value down from 6 billion euros in 2014 to 694 million euros today, and fears about the capital increase have accelerated the drop over the past week.