Heinz closes £470m HP Foods deal
HP FOODS has been snapped up by US giant Heinz in a deal worth £470m. The deal was predicted by Financial Mail and This is Money yesterday.
The agreement with Danone of France (owner of the Evian brand) also provides the ketchup-to-baked beans firm with a licence to market Amoy sauces and products in Europe. HP Foods is best known for Lea & Perrins Worcestershire sauce and brown sauces including Daddies and HP.
The imminent sale of HP Foods was first flagged by Financial Mail and This is Money in March. Since then, Heinz is understood to have beaten off competition from UK rivals Premier Foods and Associated British Foods to land HP Foods.
The US company said it would become the UK's leading sauce company through the deal, which gives it around $300m (£164m) in worldwide sales.
Heinz operates from five regional centres in the UK and employs more than 5,000 staff. Its largest site is in Wigan and makes beans and soups, while it has factories at Leamington Spa and Westwick producing frozen desserts.
HP Foods, which Danone bought from industrial conglomerate Hanson for £199m in 1988, employs around 450 workers at three factories, including at Worcester and Aston Cross, Birmingham.
Danone said the sale would allow it to refocus on its key markets of dairy products, beverages and biscuits.
Bidding has taken place at a busy time for the food production industry, with Premier snapping up the maker of meat alternative Quorn for £172m from private equity firm Montagu earlier this month.
Quorn will be Premier's largest brand, joining labels such as Ambrosia custard, Branston Pickle, HP Beans and Typhoo Tea.
AB Foods owns brands such as Ovaltine and Twinings but has focused on expanding its discount clothing chain Primark in recent months.
The spotlight also fell on the sector last week when RHM - the maker of Mr Kipling cakes and Paxo stuffing - announced plans to float on the London market. Analysts expect it to be valued at up to £1.3bn plus £700m of debt.
