Daniels deal will grow firm – Burnett

A £151m deal by a US firm to buy Daniels Group will give the company a platform for growth, according to chief executive Rob Burnett.

Mr Burnett was speaking after the Leeds-based company’s Singapore owners SATS agreed to sell Daniels and International Cuisine to Hain Celestial.

The deal will initially be worth £151m with Hain paying a further £13m depending on Daniels’s performance over the next two years.

Hain hopes the deal will give it a stronger hand as it looks to establish its global brands in the UK and to exploit Daniels’s experience in fresh soups and desserts in the US market..

Daniels operates from eight sites across the UK, including its Leeds headquarters, its New Covent Garden Food operation in Grimsby and Farmhouse Fare, in Clitheroe.

Mr Burnett, who will become chief executive for Hain Celestial UK, said: “The acquisition of the Daniels Group by Hain Celestial provides a platform for long-term, profitable growth. It is good news for both companies and will enable us to build on a position of strength in the UK’s dynamic fresh, frozen and chilled categories.

“I am looking forward to working with Hain Celestial UK’s management team to accelerate the growth of the company’s natural and organic products which complement the Daniels Group’s chilled product portfolio.

“Over the years we have focused on the long-term growth of our products in the chilled category by investing in our brands with new product innovation and building customer loyalty. With a consistent track record of delivering superior growth and profitable returns, we look forward to additional opportunities as part of Hain Celestial to leverage our footprint and expand into adjacent categories with their market-leading natural and organic brands.”

Daniels Group is a £160m turnover business which produces brands including New Covent Garden soup and Johnsons Juices.

Hain Celestian president and chief executive Irwin D Simon said: “We are extremely excited about the Daniels portfolio becoming part of Hain Celestial. We believe the addition of these category-leading brands and products along with our Linda McCartney and Daily Bread brands will create a powerhouse in the fresh and frozen natural sector in the United Kingdom.

“We believe the acquisition will also provide us with scale in our international operations to allow us to introduce some of our existing global brands, including Rice Dream, Celestial Seasonings, Earth’s Best, Terra Chips and Sensible Portions, in a more meaningful way in the marketplace.

“We will also look to expand the distribution of certain Daniels brands throughout the rest of Europe utilizing our European-based sales organization. Our momentum with consumers continues in the natural and organic sector as we experience favorable growth trends across our branded portfolio in the United States, Canada, and Europe, including the United Kingdom.”
 
KPMG’s Leeds transaction services team provided due diligence to SATS on the deal.

Partner Chris Stott said: “It’s exciting to play a role in a great local deal; especially one that helps Northern companies to demonstrate why they are an attractive acquisition in a challenged sector.

“Rising raw material costs and falling consumer spend are beating up many businesses in the food and drink sector but the strength of these companies’ brands, such as New Covent Garden Soup, and their robust cost base management, including commodity pricing issues, were critical to this deal.”