Real Good Food (RGD) has acquired a hand-made frozen desserts maker for £1.75m to expand its Haydens Bakery subsidiary into the growing foodservice sector.
Devon-based Chantilly Patisserie, employs 40 staff and supplies foodservice customers such as Marston’s Brewery, Warner Leisure, Brakes, and Country Range. The business, which will be run as a trading division of Haydens, generated revenues of £2.2m in the nine months to December 2015, with EBITDA of £400,000, and it free of debt.
Real Good Food executive chairman Pieter Totté said the transaction opened “a new channel” for the group, with Chantilly already “impressively” establishing itself as a supplier of quality products to the “important and growing” foodservice sector.
“The business complements the offering of Haydens extremely well and it is envisaged that significant commercial opportunities for both businesses will be identified as a result,” he said.
He added that the AIM-listed group was also eyeing further deals as it attempts to grow its three cake decoration, food ingredients and bakery divisions.
“We will continue to identify and complete bolt-on acquisitions as we seek to reach greater scale within our three pillar markets of cake decoration, food ingredients and, in this case, premium bakery,” Totté said.
“As we are clearly demonstrating, acquisitions will enhance our offering by targeting new sectors, product lines and geographies, as well as being earnings accretive.”
The deal comes after a profits warning last week for Real Good Food as the group admitted that investment needed to restructure after the sale of its troubled sugar business, Napier Brown, last year had led to short-term pressure on margins. Shares crashed almost 20% as a result to 35p before making a slight recovery.
The group’s stock has rallied today on the back of the deal, climbing 4.3% to 42.8p.
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