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GraceKennedy acquires UK company for $3b
published: Friday | March 2, 2007 <DIV class=KonaBody vsvsd="true">
Erwin Burton, chief executive officer of GraceKennedy's GK Foods division. </DIV>
Susan Gordon, Business Reporter
GraceKennedy Limited has acquired United Kingdom-based food supplier WT (Holdings) Limited Group, or WT Foods, for ?23million (J$3.04 billion), calling the deal a strategic acquisition to make inroads into the European market.
The company acquired WT Foods from European private equity firm Bridgepoint Capital Limited, and plans to use the operation to launch its own distribution and sales networks in Europe.
The deal, which gives Grace-Kennedy a physical presence in the UK, was sealed with a six-month financing arrangement through a bank, to facilitate immediate possession of the company, the conglomerate said.
On Thursday, GraceKennedy's stock fell $1.50 to $58.50 on the news on the Jamaica Stock Exchange. The stock last traded at TT$5.75, B$1.80, and EC$4.25 on the respective exchanges in Trinidad, Barabdos and the Eastern Caribbean.
With the acquisition of WT Foods, GraceKennedy now has a foothold in the UK. Up to now, it's presence has been through exports of its products using distributors, said corporate affairs director James Moss-Solomon.
UK sales account for about 12 per cent of GraceKennedy's group turnover.
WT Foods has a turnover of ?60 million per annum, in a UK market that demands 20 times those sales for a company to be viable.
The group comprises Enco, a supplier of Afro-Caribbean foods and drinks,Chadha, a specialist supplier of Oriental products to the grocery trade, and Funnybones, an American, Mexican, Cajun, Indian and Oriental food specialist for the food service market.
Continuing transformation
Said GraceKennedy chairman, Douglas Orane: "WT Foods will contribute immediately to the continuing transformation of our company into a global consumer group with its roots in Jamaica.
GraceKennedy looks forward to connecting with new customers in the retail, wholesale and food service markets in the UK."
The company is located at Welwyn Garden City some 23 miles north of Central London and operates from a modern distribution facility of 119,000 square feet providing ambient, chilled and frozen space, and 20,000 square feet of office accommodation.
Moss-Solomon told the Financial Gleaner that WT Foods is to be headed by Erwin Burton, deputy chief executive officer of GraceKennedy Food Services, who will handle the transition of ownership.
Burton was already in the UK when the Financial Gleaner called for comment.
No operational changes
GraceKennedy will retain the existing players and no changes will be made to WT Foods operations, besides sending two GraceKennedy staffers from the U.S. and Canada to represent the local food giant's interest in the changeover, the company said.
WT Foods is known for its principal brands Nurishment, Encona and Dunn's River.
"The purpose of the acquisition is to give us a foothold in the European Union," said Mr. Moss-Solomon.
"It's the food service market that we hadn't been in before. It means a strengthening and the ability to have our own direction in the distribution of food and we can now go into that market," he added.
GraceKennedy does roughly US$5 million of sales in the UK market from its Tropical Rhythm juices, ackee, Grace Hot Pepper Sauce and soups. The company also does a small export operation of its hot pepper sauce into France.
Moss-Solomon said Grace-Kennedy had no intention of amending its current distribution ar
published: Friday | March 2, 2007 <DIV class=KonaBody vsvsd="true">
Erwin Burton, chief executive officer of GraceKennedy's GK Foods division. </DIV>
Susan Gordon, Business Reporter
GraceKennedy Limited has acquired United Kingdom-based food supplier WT (Holdings) Limited Group, or WT Foods, for ?23million (J$3.04 billion), calling the deal a strategic acquisition to make inroads into the European market.
The company acquired WT Foods from European private equity firm Bridgepoint Capital Limited, and plans to use the operation to launch its own distribution and sales networks in Europe.
The deal, which gives Grace-Kennedy a physical presence in the UK, was sealed with a six-month financing arrangement through a bank, to facilitate immediate possession of the company, the conglomerate said.
On Thursday, GraceKennedy's stock fell $1.50 to $58.50 on the news on the Jamaica Stock Exchange. The stock last traded at TT$5.75, B$1.80, and EC$4.25 on the respective exchanges in Trinidad, Barabdos and the Eastern Caribbean.
With the acquisition of WT Foods, GraceKennedy now has a foothold in the UK. Up to now, it's presence has been through exports of its products using distributors, said corporate affairs director James Moss-Solomon.
UK sales account for about 12 per cent of GraceKennedy's group turnover.
WT Foods has a turnover of ?60 million per annum, in a UK market that demands 20 times those sales for a company to be viable.
The group comprises Enco, a supplier of Afro-Caribbean foods and drinks,Chadha, a specialist supplier of Oriental products to the grocery trade, and Funnybones, an American, Mexican, Cajun, Indian and Oriental food specialist for the food service market.
Continuing transformation
Said GraceKennedy chairman, Douglas Orane: "WT Foods will contribute immediately to the continuing transformation of our company into a global consumer group with its roots in Jamaica.
GraceKennedy looks forward to connecting with new customers in the retail, wholesale and food service markets in the UK."
The company is located at Welwyn Garden City some 23 miles north of Central London and operates from a modern distribution facility of 119,000 square feet providing ambient, chilled and frozen space, and 20,000 square feet of office accommodation.
Moss-Solomon told the Financial Gleaner that WT Foods is to be headed by Erwin Burton, deputy chief executive officer of GraceKennedy Food Services, who will handle the transition of ownership.
Burton was already in the UK when the Financial Gleaner called for comment.
No operational changes
GraceKennedy will retain the existing players and no changes will be made to WT Foods operations, besides sending two GraceKennedy staffers from the U.S. and Canada to represent the local food giant's interest in the changeover, the company said.
WT Foods is known for its principal brands Nurishment, Encona and Dunn's River.
"The purpose of the acquisition is to give us a foothold in the European Union," said Mr. Moss-Solomon.
"It's the food service market that we hadn't been in before. It means a strengthening and the ability to have our own direction in the distribution of food and we can now go into that market," he added.
GraceKennedy does roughly US$5 million of sales in the UK market from its Tropical Rhythm juices, ackee, Grace Hot Pepper Sauce and soups. The company also does a small export operation of its hot pepper sauce into France.
Moss-Solomon said Grace-Kennedy had no intention of amending its current distribution ar