Bright Food to buy 60% stake in Weetabix
May 3, 2012
by Eric Schroeder
HONG KONG — Bright Food (Group) Co., Ltd., one of China’s largest food groups, has agreed to acquire a 60% stake in The Weetabix Food Co. for approximately £1.2 billion ($1.9 billion), including company shares and debt. The remaining 40% of the shares will continue to be held by London-based private equity firm Lion Capital and the Weetabix management. The transaction is expected to be finalized in the second half of 2012.
Lion Capital said the acquisition of Weetabix marks the largest overseas acquisition by a Chinese company in the food and beverage sector. Weetabix is the second-largest branded manufacturer by value of ready-to-eat cereals and cereal bars in the United Kingdom. Its Weetabix brand accounts for 7% of the U.K.’s total cereal sales.
The company’s portfolio of household brands includes Weetabix, Weetaflakes, Oatibix, Oatiflakes, Alpen, Seriously Oaty, Ready Brek and Weetos. In addition to its strong presence in the United Kingdom, the company has operations in North America, South Africa, Germany and Spain and exports to more than 80 countries. Weetabix employs approximately 1,800 people worldwide and in 2010 generated sales of approximately £449 million.
“As a leading business in China’s food industry, we are delighted to become the majority shareholder in Weetabix,” said Zongnan Wang, chairman of Bright Food. “This company has an excellent portfolio of brands, including the famous British cereal brand, Weetabix, and also other category-leading brands such as Alpen and Ready brek. With its best-in-class production standards and excellent track record for innovation, the business is poised to achieve strong and sustainable long-term revenue and profit growth."
“We are excited by the many growth opportunities for the business, especially in international markets, and Asia in particular. With Bright Food’s strong resources and our expertise in both the Chinese and broader international markets, we are excellently placed to develop the Weetabix business. We value the expertise of Weetabix’s management and employees and look forward to collaborating with them and Lion Capital to realize the full global potential of the Weetabix family of brands.”
Giles Turrell, chief executive officer of Weetabix Food Co., added, “While company’s focus has been on reinforcing and building on our leading position in the U.K., I believe there are also substantial opportunities to further grow the business internationally, in North America, Asia and beyond. We are very excited about the future prospects for Weetabix under the guidance and support of shareholders who bring a strong track record of success and the complementary skills and expertise to execute our strategy and vision for the business.”