“Renewing the Cadbury cake licence through to at least 2017 is an important step", CEO Michael Clarke said

“Renewing the Cadbury cake licence through to at least 2017 is an important step", CEO Michael Clarke said

UK firm Premier Foods, which is trying to revitalise is grocery business, has renewed its licensing deal for Cadbury cake products in a contract worth GBP60m (US$97.6m) in annual sales.

The agreement with Mondelez International for the licensing of Cadbury branded cake products runs to "at least" June 2017 and forms part of Premier's plans to boost growth in the cake category, it said today (20 December).

The deal also provides for the possibility, subject to approval, of the use of the Cadbury brand with other trademarks for cake and dessert products, which Premier said, could provide a range of "additional growth opportunities".

"Renewing the Cadbury cake licence through to at least 2017 is an important step as we seek to build on the momentum in our grocery business," said Premier CEO Michael Clarke. "Cadbury is the fastest growing cake brand in the market and represents more than GBP60m in annual sales."

"We intend to collaborate closely with Cadbury to expand consumer favourites such as Cadbury Mini Roll as well as leverage other Cadbury trademarks over time where this makes sense. This new agreement unlocks exciting growth opportunities in one of our core power brand categories."

A spokesperson for Premier did not comment on whether the terms of the licensing deal had changed.

Premier has recently restructured its grocery operations, setting up two business units. It is also in the process of also restructuring its bread business. Operating in a UK bread sector dogged by promotions and excess capacity, Premier is trying to shake up its bread business to cut costs and improve returns. Last month, the firm said 900 jobs were to go as part of these plans.