Greencore ups its slice of UK market

Greencore has increased its presence in the British food market with the purchase of International Cuisine Ltd (ICL), a Durham-based private label chilled ready-meal business, for an undisclosed sum.

The deal marks the third significant acquisition this year for the Dublin-headquartered convenience food giant, following its US acquisitions of convenience food company MarketFare and snack foods specialist HC Schau & Son in the first half.

Greencore has bought ICL from rival convenience food group, Hain Daniels — which itself yesterday agreed to buy the sweet spreads and jellies arm of debt-laden group, Premier Foods.

In a brief statement, Greencore summed up the logic of its latest deal as thus: “The majority of its [ICL’s] revenue — approximately £45m [€56.8m] — is derived from several existing Greencore ready-meal customers. The acquired facility will also provide additional capacity for Greencore in the ready-meals category in the UK, which continues to show strong growth.”

It added that the gross assets being acquired amounted to £16.7m.

The transaction will be funded from Greencore’s existing debt facilities and will, according to the company, have “a minimal impact” on the group’s leverage, “which we still anticipate will remain below three times at the end of September, on a net debt to EBITDA basis”.

Earlier this month, Greencore — which bought British convenience food supplier Uniq in €128.5m deal last year — reported a near 47% year-on-year rise in third-quarter revenues to £298m (€380m).

The performance — covering the 13-week period until the end of June — was driven by a 51.2% annualised increase in the Dublin-headquartered group’s convenience foods division to £277.9m.