Endless is the bread winner as it acquires historic brand
Premier Foods has confirmed this morning that it has sold its interest in Hovis to Endless LLP for an undisclosed price, returning it to British ownership.
The news comes after reports said the Leeds-based private equity firm was close to securing a takeover of the bread business, which employs more than 2,700 people.
Today’s announcement states the transaction completed late yesterday (5 November) and will see Premier Foods due £37m which includes repayment of outstanding loan notes and accrued interest
The statement from Premier Foods explains that under the joint ownership the business has “undergone major supply chain restructuring” and is now “commercially well positioned to grow under new ownership.”
Earlier this week Italian food producer Newlat Food, issued a statement to the Borsia Italiana (Milan stock exchange) that it had pulled out of the race to acquire Hovis.
The price for acquiring this brand, which traces its routes back to 1886 in Macclesfield, was rumoured to be in the region of £100m.
Premier Foods which also owns brands including Bisto and Angela Delight, originally acquired the bread maker in 2007 before it sold a majority stake in the in 2014, retaining 49% of the business, before writing off the entire value of its stake two years later.
Confirming the news, Endless stated it had invested in Hovis from its Endless Fund IV.
This is its third investment in the food sector in recent times. The private equity firm previously owned and successfully realised Karro Food Group – the pork business – and currently owns BBF, a leading supplier of ambient cake products to the UK’s major grocers.
Nish Kankiwala, Hovis chief executive officer, said: “We are delighted to announce this agreement with Endless today.
“Based on our extensive engagement with Endless over the past several months, it became clear that both parties share a commitment to customers and colleagues and for building on Hovis’ heritage by investing in growing both the brand and product range.
“This shared vision makes Endless the best shareholder to support our ambitious plans.
“The acquisition will help drive our strategy for growth by bringing both strategic and operational value to Hovis.
“We are looking forward to working together to execute this strategy and to delivering the next phase of growth.”
Francesco Santinon, partner at Endless, added: “Hovis is the instantly recognisable British bread brand with a strong and established heritage.
“We were extremely impressed by the management team and have great confidence in supporting and investing in its future as Hovis looks to achieve further expansion within the bakery category.”
Hovis has seen strong growth in its branded market share and is said to be well placed to grow its share of the UK’s £4 billion bakery category.
Endless was advised by Houlihan Lokey (CF), Dechert (Legal), KPMG (Tax) and the company was advised by Robert W Baird.