Swiss bakery company Hiestand, in which IAWS has a 32 per cent stake, has bought the German bakery products company Fricopan.

The Swiss company also reported a 9 per cent rise in sales at the end of the third quarter to 361.8 million Swiss francs (€227 million).

Hiestand, which said the deal would result in an increase in earnings per share, did not disclose how much it paid for the German firm.

Fricopan, which produces frozen and chilled bakery products, had sales of €100 million last year and employs 750 people. It manufactures products on an exclusive basis for Molkerei Meggle, one of Germany's leading retail groups, as well as supplying products to the Italian, Scandinavian, Spanish, Austrian, UK and US markets.

"The deal further cements IAWS as the leading par baking group in Europe, given its 32 per cent stake in Hiestand," said NCB analyst Paul Meade.

"The acquisition multiple is one times sales or €100 million. Assuming a 6 per cent cost of finance and a 30 per cent tax rate, the deal should add 0.6c to IAWS' earnings per share in a full year and will also enhance Hiestand's own earnings per share."

Last December, IAWS increased its stake in Hiestand to 32 per cent when it spent €36.6 million buying a further 10.6 per cent of the company.

It bought its original 22 per cent stake in the Swiss company for €26 million in 2003.

Hiestand has manufacturing and distribution operations in Switzerland, Germany, Poland, Austria, Britain and Japan.