Catering group swallowed in £70m deal

Ben Maxted

Wholesale group Kitwave has announced a £70m deal to buy Gloucestershire-based Creed Catering Supplies with around half of that sum coming from a capital raise.

The North Shields-based group has agreed to buy the business for an initial £60m in cash, plus a further £10m over the next two years based on performance targets being achieved.

The consideration is payable in cash with the initial consideration being financed from an increase in the company’s banking facilities and from the capital raising.

Creed is a family-owned company with a range of customers within the leisure, hospitality, education and the care sectors.​ Last year it had revenues of £124.2m and made an operating profit of £7.8m.

The enlarged group post-acquisition is expected to achieve revenue of over £800m, adjusted EBITDA of £55m and adjusted operating profit of £42m.

Ben Maxted, chief executive of Kitwave, said: “Creed has an exceptional heritage and is one of the UK’s leading foodservice wholesalers, so we are delighted to have reached this agreement, which will extend our Foodservice division.

“Strategically, Creed will significantly expand our geographical presence, bridging our operations in the North and South and creating a fully integrated national delivery network. In line with our buy and build strategy, Creed is also expected to significantly enhance the Group’s earnings along with providing material buying, operational and financial​ synergies.

“We are looking forward to working with Creed’s dedicated and experienced team and excited to see our Foodservice division continue to go from strength to strength.”

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