Hilton to make sous-vide acquisition

Hilton to make sous-vide acquisition

Hilton Food Group, the UK-based meat and seafood supplier, is set to add again to its operations through M&A, today (8 February) announcing a deal to buy local sous-vide manufacturer HFR Food Solutions.

London-listed Hilton Food Group said the acquisition would see it enter "the fast-growing sous-vide market" and enable the group "leverage its expertise" in the procurement and the manufacturing of meat products in a new segment with retail and foodservice customers.

Hilton Food Group CEO Philip Heffer is a director and shareholder of HFR Food Solutions, owning 30% of the business. Graham and Robert Heffer, who are also HFR Food Solutions directors and who both each own 30% of the firm, are also directors of Hilton Food Solutions Ltd, an indirect subsidiary of Hilton Food Group.

HFR Food Solutions, which operates from a production site in Wednesbury in England's West Midlands, manufactures sous-vide products for retail, wholesale and foodservice outlets in the UK. In the year to 30 September 2018, the business generated turnover of GBP24m (US$31.1m).

Hilton Food Group, which in its last full financial year, generated revenue of GBP1.34bn, also said the planned deal broadens the types of proteins it supplies in the UK. The company said pork and poultry represent "a significant proportion" of HFR's output.

In a stock-exchange filing, Hilton said the purchase price for HFR is structured so GBP100 is paid on completion with the remainder payable three years afterwards.

The deferred consideration will be calculated by subtracting the net debt of HFR from the enterprise value of HFR, with each metric calculated as at 28 February 2022.

Hilton Food Group said it is estimated the actual deferred consideration payable will be approximately GBP3.3m but added: "The final amount will depend on the performance of the HFR business." Hilton will provide a secured loan of GBP2.8m to HFR on completion to finance the company.

Robert Watson, Hilton Food Group's executive chairman, said: "This acquisition represents an exciting opportunity for Hilton to broaden its offering in a fast-growing segment of the market and meet our customers' demands for Hilton to supply them with a range of innovative, high-quality sous-vide products."

HFR director Graham Heffer added: "We are pleased with Hilton's acquisition of HFR as it will enable the business to benefit from Hilton's expertise, improve its operations and continue to focus on giving our customers the right products at competitive prices."

The news of the planned acquisition came alongside Hilton announcing competition approval for its move, announced in October, to buy 50% of Netherlands-based Dalco Food, a supplier of meat and vegetarian products.