NewPrinces Acquires Strategic Edge in European Nutritional Markets: A Value Play with Growth Catalysts

The acquisition of Kraft Heinz's Italian baby and specialty food business by NewPrinces marks a pivotal step in consolidating its leadership in Europe's nutritional markets. This €120 million cash deal, which includes the iconic Plasmon plant in Latina, Italy, underscores NewPrinces' ability to capitalize on undervalued assets while expanding its footprint in high-margin, specialized food sectors. For investors, the transaction presents a compelling opportunity to buy into a well-positioned player with a proven track record of synergistic acquisitions and operational discipline.

Strategic Rationale: Building a European Nutrition Powerhouse
The acquisition targets NewPrinces' core strengths: specialty foods and nutritional products. The Latina plant, producing 1.8 billion Plasmon biscuits annually and supplying Heinz Baby Food to the UK market, adds critical scale and brand equity. By integrating this facility—alongside the 2015 acquisition of another Heinz plant—NewPrinces reinforces its control over Italy's infant and medical nutrition sectors, where Plasmon has been a household name since the 1930s.

The Mastrolia family, which owns NewPrinces, has long prioritized acquisitions that align with its strategic vision. This deal follows the 2024 integration of the Princes Group, which expanded its reach into UK and European markets. The synergies here are clear: combining Plasmon's Italian production with NewPrinces' existing portfolio of dairy, canned fish, and ready meals positions the firm to dominate niche segments with strong recurring demand.

Financial Analysis: Accretive EBITDA and Undervalued Enterprise Value
NewPrinces' FY 2024 financials reveal a company primed for growth. Despite a slight dip in revenue to €2.775 billion, the Q4 turnaround—driven by 8.3% growth in core operations and 5.8% from Princes—signals resilience. EBITDA rose to €177.6 million, with margins improving to 6.4%, and free cash flow hit €225 million. The acquisition's target, with €17 million in EBITDA (on €170 million revenue), is accretive from day one, especially given NewPrinces' low EV/EBITDA multiple of under 6x.

The €120 million price tag represents a 7x multiple on the target's EBITDA—far below NewPrinces' own valuation, suggesting upside as synergies materialize. The deal's cash-free, debt-free structure and the buyer's reduced net debt (€246 million as of December 2024) further indicate financial flexibility. With the Latina plant's operations and 300-person workforce retained, execution risk is minimized, and synergies in procurement and distribution can amplify margins.

Valuation Case: A Discounted Growth Story
NewPrinces' enterprise value of €1.62 billion as of July 2025 contrasts sharply with its growth trajectory. At less than 6x forward EBITDA and a market cap of €750 million, the stock trades at a discount to peers like Danone or Nestlé. Yet, NewPrinces' specialty divisions—milk, dairy, and canned fish—are growing at mid-single-digit rates, with the UK market now a key driver post-Princes integration. The Latina acquisition adds another high-margin segment, potentially lifting EBITDA to €200 million by 2026, which would lower the EV/EBITDA multiple to ~5x.

The Mastrolia family's operational focus—streamlining supply chains, reducing IFRS 16 liabilities, and centralizing brand management—supports this outlook. With a net debt/EBITDA ratio of 1.95x, the balance sheet is strong enough to absorb the cash payment without dilution.

Investment Thesis: Buy the Dip, Target 2026 Upside
This acquisition is a textbook example of a value-oriented, accretive deal in a defensive sector. NewPrinces' valuation gap relative to its growth profile and synergistic potential makes it a standout opportunity. Investors should consider:

• Catalysts: Q4 2025 completion of the deal, 2026 EBITDA upside from synergies, and renewed brand momentum for Plasmon/Nipiol in Italy.
• Risks: Supply chain disruptions, regulatory hurdles, or slower-than-expected integration.
• Valuation Targets: If EBITDA reaches €200 million by 2026, a 6x multiple would imply an EV of €1.2 billion—already below current levels—while upside to 7x could push EV to €1.4 billion.

Conclusion
NewPrinces' acquisition of the Latina plant is more than a regional play—it's a strategic move to build a pan-European nutritional powerhouse. With a disciplined management team, undervalued shares, and a pipeline of synergies, this is a stock ripe for near-term buying. For investors seeking stability in uncertain markets, NewPrinces offers a rare blend of growth, defensive cash flows, and a margin of safety.

Action: Consider adding NewPrinces to your portfolio at current levels. The acquisition's accretive nature and the company's low valuation relative to peers suggest significant upside potential by 2026.