Associated British Foods (ABF) is in discussions with private-equity firm Endless as the manufacturer weighs up the future of UK bread arm Allied Bakeries.
In a brief statement on the ABF website, the UK group confirmed the two sides are in talks “regarding a potential transaction”.
Last week, ABF, which has its origins in the UK bread sector, said it had put Allied Bakeries up for review amid a “very challenging market”.
UK private-equity firm Endless has owned Allied Bakeries rival Hovis since 2020.
“Associated British Foods plc notes recent media speculation and confirms that it is in discussions with Endless LLP regarding a potential transaction,” ABF’s statement read today. “However, there is no certainty that a transaction will be concluded nor as to the terms of such a transaction.
“As stated in our interim results announcement on 29 April 2025, Allied Bakeries continues to face a very challenging market. We are evaluating strategic options for Allied Bakeries against this backdrop and we remain committed to increasing long-term shareholder value. A further announcement will be made as and when appropriate.”
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By GlobalDataThe Allied Bakeries business markets bakery products under brands including Kingsmill, Sunblest and Allinson’s. It also supplies UK retailers with private-label products.
ABF, which also owns and operates the Primark clothing stores, does not break down the financial performance of Allied Bakeries or for other food brands within its grocery business such as Twinings tea and the Patak’s and Blue Dragon sauces lines.
Last Tuesday also saw the company report its financial results for the 24 weeks to 1 March.
In terms of grocery, ABF’s sales revenue dropped 2% to £2.09bn ($2.79bn). Operating profit was flat at £219m, while adjusted operating profit fell 1% to £227m.
ABF said it posted “good sales growth” in grocery “across most of our brands” with the exception of Allied Bakeries and its cooking oils business in the US, which includes the Mazola brand.
In commentary alongside the results, the company said: “We continue to expect overall performance this year to reflect the normalisation of profitability in our US-focused businesses and an operating loss in Allied Bakeries.”
Group results showed a 2% decline in sales to £9.51bn, while adjusted operating profit dropped 12% to £835m.
