Investors sought as food firm eyes rival’s brands

David Salkeld, managing director of the Leeds-based firm, yesterday confirmed the company was considering refinancing options to raise funds for potential acquisitions from Britain’s biggest food manufacturer.

But he denied national reports that Symington’s, which owns brands including Ainsley Harriott and Mug Shot, had been put up for sale.

The company is 55 per cent owned by private equity firm Bridgepoint Development Capital, with senior managers of the business owning the remaining 45 per cent.

Any new investors would reduce Bridgepoint’s stake in the business rather than the management’s, Mr Salkeld said.

He added the firm was in talks with a number of private equity companies for further investment and also a number of banks to provide senior debt finance as the company continues to grow.

“We, the management, will continue to drive the growth of the company. We think we can build a bigger and even more successful business,” he said.

Premier has been forced to sell off brands to raise money to pay off its near £1bn debts and intends to focus on eight “power brands” including Hovis bread. Premier racked up its borrowings during a spending spree that included Mr Kipling owner RHM, although it has insisted it is on the mend after recently sealing a £1.4bn refinancing deal.

Mr Salkeld confirmed Symington’s was in talks with the company about taking over some of its well-known names, although he declined to say which ones.

“Premier Foods is looking to get rid of products in three areas: pickles and vinegars, jams and spreads and dried foods,” he said. “We are interested in looking at all those areas.

“Our representatives are talking to their representatives and examining what the options are.”

Symington’s has grown organically by specialising in taking “under-utilised brand equity” and developing new ambient products to sell to the major food retailers.

It competes directly with multinationals like Unilever, Nestle and Premier Foods, all multi-billion pound operations.

Mr Salkeld said: “The industry is in a phase of consolidation at the moment and we are looking at other potential acquisitions alongside Premier.”

Turnover for the company was £125m for the year to the end of February 2012, with £174m forecast for the year ahead.

Mr Salkeld said: “We are looking at potential acquisitions with a new product development lens. We have a five-year track record of bringing heritage brands to life.”

He added: “Premier has its challenges and hasn’t been able to give some of its brands the love, care and attention they need in terms of new product development because they have been under financial stress.

“We would be a logical buyer of them and we would give them the tender loving care they need. But that’s not to say we will get them.”

Symington’s was set up by William Symington in 1827 when he invented dried soup, which was used by Captain Scott’s first Antarctic expedition in 1901.

The company was bought by Mr Salkeld and Henrik Pade, marketing director, who are both key shareholders in the business, in a management buy-in in September 2007, with backing from Bridgepoint Development Capital and Yorkshire Bank.

It has since gone on to buy a number of well-loved brands, including Ragu and Chicken Tonight, which it bought last summer from Unilever.

Sales of Ragu and Chicken Tonight currently total £36m in the UK and Ireland but Symington’s hopes to double the figure after spending £2m on re-packaging and re-launching the sauces in June.

Ragu was the first pasta sauce to hit the shelves in 1988.

The re-launch of Chicken Tonight will include a viral marketing campaign encouraging families to come up with a dance to the original memorable advert jingle and post it on YouTube. The advert, which aired in the 1990s, starred former footballer and television presenter Ian Wright.

The company, which was previously a dried food manufacturer, first entered the “wet” market in January 2011, after striking a deal with soup giant Campbell’s to bring the brand back to the UK consumer.

Earlier this year, Symington’s bought the Quosh brand from Britvic, resulting in the launch of a range of powdered drinks and marking its first foray into the drinks market. Its other brands include James Martin, Golden Wonder and Crosse & Blackwell.

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