Intersnack Group agrees to acquire KP Snacks
DUESSELDORF, GERMANY — Intersnack Group has reached agreement to acquire KP Snacks from United Biscuits (U.B.), which is owned by Blackstone Group L.P. and PAI Partners. Financial terms of the transaction were not disclosed by the companies, but two people with knowledge of the terms of the sale told The Financial Times that the transaction was for £504 million ($811 million), or nine times the unit’s earnings.
KP Snacks is the No. 2 snack manufacturer in the United Kingdom and is known for such brands as McCoy’s, Hula Hoops, KP Nuts, Space Raiders, Nik Naks, Wheat Crunchies, Skips, Phileas Fogg, Discos, Roysters, Choc Dips, Brannigans, Frisps, KP Crisps, KP Mini Chips and Cheese Footballs. In addition to the brands, the transaction includes KP’s U.K. manufacturing facilities and a head office. U.B. will retain ownership of its baked bagged snack brands manufactured in its biscuit facilities, including Mini Cheddars and Twiglets.
KP employs 1,500 and has annual sales of approximately £280 million ($450.6 million), and combined with Intersnack is expected to generate net sales of more than £1.7 billion ($2.7 billion) and employ 8,000.
“We are very pleased to be teaming up with KP Snacks, which represents a strong and highly complementary fit with the Intersnack family of leading businesses throughout Europe,” said Maarten Leerdam, executive chairman of Intersnack. “Intersnack is a strong believer in the power of iconic, local hero brands, and we aim to leverage these strengths for further expansion. As a privately owned company, we operate our business with a long-term view. As such, the joint know-how of KP Snacks and Intersnack will drive the development of these iconic brands.”
David Fish, non-executive chairman of U.B., added, “KP Snacks is an excellent fit into Intersnack’s existing operations. This exciting deal ensures that the KP brands continue as part of a major European snacks business, which gives them the scale and support needed in a competitive market place. It also allows U.B. to concentrate its attention solely on continuing to develop and grow its baked biscuit and snack product range.”
Mr. Leerdam noted the U.K. market is the largest and most innovative snack market in Europe, and further expansion in this market remains a key priority for Intersnack.
“We appreciate the significance of acquiring a part of British heritage and the proposed transaction reflects our goal to accelerate the transformation of Intersnack’s strategic position in the U.K.,” he said. “We look forward to working with the existing KP Snacks management team and employees to leverage this opportunity.”
Intersnack Group is one of the leading manufacturers of savory snacks in Europe, competing in such categories as potato crisps, extruded and pellet products, nuts, crackers, pretzels and salted sticks.
United Biscuit is the leading manufacturer and marketer of biscuits in the United Kingdom and second largest in The Netherlands, France, Belgium and Ireland. In March, Blackstone Group and PAI Partners, the private-equity owners of United Biscuits, appointed Credit Suisse to separate the food company’s salty snack business from its other operations.
Blackstone Group and PAI Partners tried unsuccessfully in 2010 to sell all of United Biscuits, but they came up short when a rumored deal with China’s Bright Food Group P.L.C. fell through. Blackstone Group and PAI Partners acquired United Biscuits in October 2006 for more than $3 billion.