Government fund chips in $45m for Arnott’s $1.75b debt deal to take Tim Tams to the world

The federal government-owned National Reconstruction Fund Corporation (NRFC) has chipped in $45 million as part of a $1.75 billion debt refinancing agreement secured by Australia’s largest biscuit manufacturer – a move that backs plans by The Arnott’s Group to sell more Tim Tams to a global market.

The investment is the third debt agreement secured by NRFC which aims to diversify Australian industry by supporting sectors such as renewables, medical science and advanced manufacturing.

NRFC says its participation in the debt round backs the planned investments by Arnott's in Australian manufacturing to drive both domestic and international growth ambitions.

Morgan Stanley and Mitsubishi UFJ Financial Group also supported the refinancing arrangement for The Arnott's Group's debt facility which matures in 2026.

Arnott’s, which was acquired by US private equity group KKR in 2019 from Campbell Soup Company for $3.2 billion, has already taken Tim Tams to the world, kicking off last year in the UK.

Australia’s top-selling biscuit is currently stocked in major British supermarkets, with plans by Arnott’s to expand into other markets.

NRFC says Tim Tam sales are already outperforming expectations in the UK market, with more than five million packs sold since the product was launched in the country in April last year.

“Arnott’s is a great Australian company, and its products are a source of pride and enjoyment for so many Australians,” says David Gall, the CEO of NRFC.

“So many of us have taken a pack of Tim Tam biscuits with us when we set out on travels across the globe. Taking such an iconic brand to international markets is something that is good for Australia and which the NRFC is excited to play a part in.

“For this great company to thrive into the future it needs to be positioning itself as a leader in advanced manufacturing in Australia and adapting its production lines to be future ready. The NRFC is pleased to be part of the refinancing of Arnott’s’ debt.”

The Arnott’s Group, which was founded in Newcastle in 1865 by Scottish baker William Arnott, employs about 2,500 Australians across five facilities.

While revenue figures are not disclosed, the group is estimated to generate sales of more than $1.5 billion annually. The most recent reports show that sales hit $1.3 billion in FY20, a year boosted by lockdown snacking.

NRFC, which has $15 billion to invest via loans, equity investments and loan guarantees across its priority areas, notes that the Arnott’s deal is its third debt investment since inception last year.

It is also among 17 investments totalling $1.02 billion announced since the government-backed group began investing in late 2024.

“This deal is significant because it is the second we have done in the Priority Area of Value Adding in Agriculture, an important part of the national economy,” says NRFC chief investment officer Mary Manning.

“This is one of the seven priority areas our legislation mandates us to invest in and signifies our confidence that value adding in agriculture through processing foods and producing consumer packaged goods is an area where Australia can and should compete with the world.”

NRFC's priority areas comprise renewables and low emissions technologies; enabling capabilities; defence capability; transport; value-add in resources; value-add in agriculture, forestry and fisheries; and medical science.