Ice cream specialist Hill Station is to scoop up two larger rivals in an audacious £5.6m deal.
The Wiltshire-based company, run by husband and wife team Charles and Gina Hall, has stunned rivals by announcing plans for the reverse takeover of Loseley Dairy Ice Cream and Granelli McDermott.
AIM-listed Hill Station, which has a modest 2,500 sq ft factory, plans to move all its production to Loseley’s kingsize 80,000 sq ft site at Cwmbran in South Wales. The company’s 12 workers will be offered new jobs at the site.
The deal, set to be completed next month, will mark quite a coup for Hill Station, which will inherit a significant own label business from both
companies as well as a number of brands, including Loseley’s Yorkshire Dales and Thayer’s offerings.
However, it looks set to have its work cut out as both acquisition targets have suffered poor fortunes of late. Loseley posted a 2% dip in turnover to £5.82m in the year to September 10, although its operating loss was down to £692,000 from £938,000 the year before.
Cheshire-based Granelli also has its problems, with turnover down to £5.84m in the 10 months to August 31 from £6.75m the previous year. Although still turning in an operating profit, this was down to £50,000 in the latest review period, compared with £146,000 in 2004. A decision has yet to be made on the future of Granelli’s two production sites.
Hill Station - which was founded in 1996 and has yet to turn in a profit itself - will be inheriting a combined debt of £3.6m from both businesses. The deal includes paying £1.95m for Granelli and meeting a derisory £10 price tag for Loseley.
One analyst said: “This is a bold move but the business clearly believes it has the know-how to make it work, so it deserves praise for thinking big.”
Hill Station group MD Charles Hall said: “These acquisitions will see a major transformation of Hill Station from a niche manufacturer of branded products to a broad-based player in the ice cream sector.”
In the six months to July 31, Hill Station turned in an operating loss of £369,000 off a turnover of £492,000.
However, Hall expects quick progress under the new group.
Simon Mowbray
The Wiltshire-based company, run by husband and wife team Charles and Gina Hall, has stunned rivals by announcing plans for the reverse takeover of Loseley Dairy Ice Cream and Granelli McDermott.
AIM-listed Hill Station, which has a modest 2,500 sq ft factory, plans to move all its production to Loseley’s kingsize 80,000 sq ft site at Cwmbran in South Wales. The company’s 12 workers will be offered new jobs at the site.
The deal, set to be completed next month, will mark quite a coup for Hill Station, which will inherit a significant own label business from both
companies as well as a number of brands, including Loseley’s Yorkshire Dales and Thayer’s offerings.
However, it looks set to have its work cut out as both acquisition targets have suffered poor fortunes of late. Loseley posted a 2% dip in turnover to £5.82m in the year to September 10, although its operating loss was down to £692,000 from £938,000 the year before.
Cheshire-based Granelli also has its problems, with turnover down to £5.84m in the 10 months to August 31 from £6.75m the previous year. Although still turning in an operating profit, this was down to £50,000 in the latest review period, compared with £146,000 in 2004. A decision has yet to be made on the future of Granelli’s two production sites.
Hill Station - which was founded in 1996 and has yet to turn in a profit itself - will be inheriting a combined debt of £3.6m from both businesses. The deal includes paying £1.95m for Granelli and meeting a derisory £10 price tag for Loseley.
One analyst said: “This is a bold move but the business clearly believes it has the know-how to make it work, so it deserves praise for thinking big.”
Hill Station group MD Charles Hall said: “These acquisitions will see a major transformation of Hill Station from a niche manufacturer of branded products to a broad-based player in the ice cream sector.”
In the six months to July 31, Hill Station turned in an operating loss of £369,000 off a turnover of £492,000.
However, Hall expects quick progress under the new group.
Simon Mowbray
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