View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. News
December 18, 2020

Kerry quiet on report of consumer division review

Could the Irish branded, private-label and ingredients supplier be ready to say farewell to its consumer-facing division?

By Dean Best

Kerry Group has refused to be drawn on a report claiming the Ireland-based food and ingredients manufacturer is considering the future of its consumer-facing division.

Free Report
img

What are the key consumer trends driving FMCG in 2022?

The consumer landscape has permanently changed since the COVID-19 pandemic began, prompting trends to emerge or accelerate, causing subsequent macro-economic shifts. In order to stay relevant, Consumer Packaged Goods companies must stay abreast of these developments. It is here that GlobalData can offer valuable assistance. Download GlobalData’s Trendsights: Trends to Watch in 2022 report to:
  • Gain insight into the 12 most important trends across the FMCG value chain
  • See the consumer survey data that underpins these insights
  • Learn what early-movers are already doing in terms of NPD and product marketing
Take a look at this report to give yourself the best standing in this developing market.
by GlobalData
Enter your details here to receive your free Report.

Bloomberg, citing unnamed sources, said Kerry is weighing up what options it has for the unit, which is home to brands including Richmond sausages and Dairygold butter.

The business media outlet said the sources had suggested Kerry could look to sell the entire division, or spin it off, or try to find buyers for the assets in a piecemeal fashion. A review of the unit is said to be in its initial stages.

Kerry declined to comment when approached by just-food this afternoon. “The company does not comment on rumours or speculation,” a spokesperson said.

The Tralee-based group’s Consumer Foods arm, which also markets Naked Glory meat-free products and Cheestrings cheese snacks, has long been the smaller part of its business by revenue and margins and its future has often been chewed over by parts of the investment community.

In 2019, Kerry’s Consumer Foods arm accounted for just over 18% of its EUR7.2bn (US$8.81bn) of revenue (back in 2013, for example, that proportion stood at 28%), generating a “trading margin” of 7.6%. The company’s ingredients business made up the rest of the revenue and booked a trading margin of 15.3%.

Offloading the consumer-facing assets could provide resources to invest in Kerry’s ingredients division, which the company has been looking to grow through M&A.

“The final hurdle remains of who a realistic buyer could be, of a business whose valuation could be higher than we first thought,” analysts at Jefferies said today. “With obvious trade buyers not appearing to have balance sheet flexibility, private equity would be the remaining plausible option. There could also an opportunity for this to be done piecemeal (by brand or split fresh/frozen), a tactic [UK manufacturer] Premier Foods have employed in recent years.”

Related Companies

Free Report
img

What are the key consumer trends driving FMCG in 2022?

The consumer landscape has permanently changed since the COVID-19 pandemic began, prompting trends to emerge or accelerate, causing subsequent macro-economic shifts. In order to stay relevant, Consumer Packaged Goods companies must stay abreast of these developments. It is here that GlobalData can offer valuable assistance. Download GlobalData’s Trendsights: Trends to Watch in 2022 report to:
  • Gain insight into the 12 most important trends across the FMCG value chain
  • See the consumer survey data that underpins these insights
  • Learn what early-movers are already doing in terms of NPD and product marketing
Take a look at this report to give yourself the best standing in this developing market.
by GlobalData
Enter your details here to receive your free Report.

Topics in this article: , ,
NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. A weekly roundup of the latest news and analysis, sent every Friday. The industry's most comprehensive news and information delivered every other month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Just Food