German bakery conglomerate offloads pieces to international markets following a 130-year tenure
In a significant move, the 124-year-old German bakery chain, Junge Die Bäckerei, has decided to sell 74.9% of its shares to the Dutch investment company, Egeria. This strategic sale comes as Junge seeks to secure capital for expanding its production sites and upgrading its technology.
Founded in 1897, Junge Die Bäckerei is a leading provider of bakery and quick-service food concepts in northern Germany, with about 210 stores and 5,000 employees. The new capital from Egeria will be specifically used to fund production site expansion and technological improvements, allowing Junge to strengthen its market presence and operational capacity.
Egeria, a pan-European investment company founded in 1997, focuses on investing in healthy companies with an enterprise value of up to €500 million. Their partnership with Junge Die Bäckerei is intended to leverage their experience and resources to drive Junge’s growth strategies while maintaining high standards for product quality, variety, and customer service.
The transaction, subject to approval from the cartel office, is expected to be official in September. With the partnership, Junge aims to support its continued growth in its existing northern German regions and enable selective expansion into new regions. The management of the bakery chain, along with the Junge family, will continue to support the company.
The decision to sell parts of the company abroad is a result of Junge exploring new paths. The bakery chain values quality and regionality, and wants to ensure these aspects continue in the future. The new funds will be used to open ten to fifteen new branches, invest in marketing, IT, and production.
The bakery industry in Germany is currently facing challenges, with an increase in traditional businesses closing and a decrease in the number of bakeries. The lack of staff in bakeries is another contributing factor. Some bakeries are resorting to unusual methods to find staff due to the lack of trainees and skilled workers.
However, this sale also presents opportunities. A German bakery chain has taken advantage of this by selling the majority of its shares abroad. The partnership aims to help Junge compete effectively against competition, such as customers preferring to buy baked goods cheaply at discount stores.
The partnership with Egeria is not a result of an impending insolvency for Junge Die Bäckerei. Despite flourishing in the country, the bakery chain needs a financially strong investor to continue its growth. This strategic sale is a step towards securing long-term growth and regional expansion opportunities beyond its current stronghold in northern Germany.
The partnership with Egeria will enable Junge Die Bäckerei to secure finance for expanding its production sites and upgrading its technology, enhancing the company's market presence and operational capacity within the competitive business environment of the bakery industry. Now armed with the new capital, Junge aims to open ten to fifteen new branches, invest in marketing, IT, and production, facilitating its continued growth in existing regions and selective expansion into new regions.
