Following Langholm Capital’s sale of Tyrrells to private equity firm Investcorp for £100m last week, private equity is again making all the running in the sale of Whitworths.

City sources told The Grocer that Whitworths had failed to attract any interest from trade buyers, partly because of the breadth of its portfolio, which spans home baking, dried fruits and stuffing.

Talks with a potential buyer are now understood to have gone into exclusivity. Private equity firms LDC, CapVest and Equistone have all been linked to the sale, news of which emerged in March when owners European Capital engaged Stamford Partners to sell the business with a price tag of £100m.

Interest from trade buyers has been lacking in recent UK food industry deals. City sources said no trade buyers came forward in the auctions of Noble, Rowse or Fever-Tree, and interest was also weaker than expected for Ella’s Kitchen, KP snacks and Premier Foods’ spreads business, despite all ending up in trade hands.

The flipside is a resurgence in big private equity financed acquisitions. Boosted by the sale of R&R Ice Cream to PAI Partners in April for £715.5m, the combined value of private equity-backed food and drink deals during the quarter was higher than at any point since 2008, said Grant Thornton.

After a slow start to the year, the number of mergers and acquisitions had risen 21% in the second quarter to 41, it added.

Persistently high valuations and uncertain growth prospects have put off buyers, but private equity firms have had to make deals. “Trade never have to buy anything. Private equity firms do” said one city source.

Trade buyers would return in greater numbers as market conditions improved, he added.

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