SCHLIEREN, SWITZERLAND — After months of speculation Aryzta AG’s strategy is now clear: Focus on Europe and Asia-Pacific (APAC) markets and dispose of businesses in both North America and Latin America.

The announcement was made by the Swiss-based company’s board of directors following the conclusion of its annual general meeting held Dec. 15.

For months, Aryzta has been a revolving door of activity, with numerous executives leaving, changes in key leadership, speculation swirling about a potential takeover, and the disposal of the company’s North American take-and-bake pizza business.

Now, the company hopes to get back on firm footing with the election of a strong, unified new board that Aryzta said features “robust bakery, financial, governance, and turnaround expertise.” That board, Aryzta said, looks forward to implementing a new strategic plan and creating sustainable value for all shareholders and stakeholders.

“The board collectively believes that Aryzta is a fundamentally solid business with dedicated employees, well-invested assets, and leading market positions, serving the world’s most successful retailers, QSR and foodservice companies,” Aryzta said. “Our plan focuses on reshaping our core business and core markets to ‘best-in-class’ performance for the bakery sector, our food quality, and our customer experiences and relationships.”

Aryzta described the past few years as “tumultuous,” noting that feedback from shareholders, customers, suppliers, lenders and employees paints a picture of a “painful, uncertain and destructive period for all.”

The newly formed board now hopes to bring that chapter in Aryzta’s history to a close.

“The last three months have confirmed shareholders’ desire to get Aryzta finally back on track, and our two-part plan is already in the process of being executed,” the company said. “First, the preparation for the disposal of selective businesses to reduce the company’s indebtedness is in progress. Secondly, we have taken the first steps to improve the remaining business’s performance to at least peer-equivalent operational and financial metrics.

“Concerning the disposal of selected businesses, financial advisers were appointed in November to assist in this process. Furthermore, Aryzta has received a high number of expressions of interest for various other parts of its portfolio.”

Earlier this month, Aryzta sold its take-and-bake pizza business in North America to Great Kitchens Food Company, Inc., a newly-formed portfolio company of Greenwich-based private equity firm Brynwood Partners VIII LP. Financial terms of the transaction were not disclosed.

The sale of the North America pizza business is just a first step in the company’s broader strategy to focus on its Europe and APAC markets and to dispose of its businesses in both North America and Latin America.

“Our engagement with interested parties for these businesses is progressing well, and we have already communicated this to our key customers in these regions,” Aryzta said. “As outlined previously, we expect to secure sufficient proceeds to significantly reduce debt levels over the next six to nine months. We will also ensure that we have a smooth transition plan in place in North America and Latin America to safeguard the interests of our customers and employees, our service levels as well as our product standards. We will update the market on progress in due course.”

Aryzta plans to shift its focus to its operations in Europe and APAC, preparations of which already are well underway, the company said.

“By the end of 2021, we expect to secure at least a 25% reduction in central overhead costs as we move to a multi-local, lean and more agile business model,” Aryzta said. “The process to remove central costs has already started as we simplify operations and make local and country management responsible for all their costs and profit delivery targets. This will also result in improvements in our customer engagement experience through faster decision-making, shorter new product innovation lead times, improved customer service and enhanced quality control responses.”

According to Aryzta, its fiscal 2019 EBITDA margin was 9%, which placed it among the lowest of its European peers. As part of its new focus Aryzta plans to raise its EBITDA margin run rate to its peer median level of 12.5% by simplifying its business and moving to a multi-local model. The company said it expects to achieve the improved run rate within the next two years.

“Aryzta operates in growing markets, and many of its European competitors are midsized privately owned businesses with succession issues,” the company said. “Once we have improved our performance and reduced our debt levels, Aryzta will have the potential to actively participate in this likely market consolidation process. We also envisage a return to sustainable organic growth over the next two to three years as our locally empowered business model improves its innovation power and new contract win rate.”

Aryzta said the “imminent rollout” of COVID-19 vaccines significantly improves its fiscal 2021 prospects for a strong recovery in its foodservice financial performance, which has been severely negatively impacted by the ongoing range of government restrictions across all the company’s markets.

“The board remains confident that our strategy of simple, practical and prudent measures will enhance value for all of Aryzta’s stakeholders,” the company said.