NORTH RYDE, N.S.W. — Green’s Food Holdings, an Australian food company that makes and distributes cake mixes, breakfast cereals, snacks and savory biscuits, has agreed to buy the biscuit division of Goodman Fielder Ltd. for approximately A$17 million ($15.1 million), including net cash proceeds of approximately A$10 million.
Goodman’s biscuit business comprises a range of sweet and savory biscuits, including cookies, creamies and fancies, plain and shortbreads, chocolate and crackers. Major brands include Paradise, Cottage, Vive and Veri Deli. In addition to the above brands, Green’s has acquired the license to use the White Wings brand for biscuits for a fixed term.
In divesting its biscuit business, Goodman said it is following through on its strategy to refocus its marketing and capital expenditure on its core categories and brands where it has profitable, market leading positions.
“The biscuits business is not core to our grocery division, and we formed the view that this business can maximize its potential under different ownership,” said Chris Delaney, chief executive officer of Goodman Fielder. “For Goodman Fielder it allows us to concentrate our internal resources and investment on our core brands within the grocery division where we have profitable, category leadership positions including spreads, flour and cake mix and dressings and mayonnaise.”
Net proceeds from the transaction will be used to reduce net debt and further strengthen Goodman Fielder’s financial position. The company said it expects to record a non-cash impairment charge after tax of about A$50 million to A$55 million.
The transaction is expected to be completed by the end of February 2014.Once completed, the acquisition will make Green’s the largest Australian-owned biscuit company. The company’s brands include Green’s, Lowan, Poppin, Waterthins and Roccas Deli.