UK ice cream company Hill Station has announced that it has entered into two conditional agreements to purchase the entire issued share capitals of Granelli McDermott and Loseley Dairy Ice Cream.

The aggregate consideration for the acquisitions is approximately £2m (US$3.6m) in cash, together with the repayment of loans to certain of the vendors of approximately £400,000 and the assumption or repayment of approximately £3.2m of existing bank facilities. The acquisitions are conditional on, amongst other things, approval at an EGM of Hill Station, to be called following a placing to raise gross proceeds of up to £7.5m, which is in the course of being finalised.

Granelli manufactures a broad range of ice cream products under supermarket and other customer brands as well as under the Louis Granelli, Granelli and More from Granelli brands. Loseley manufactures a broad range of ice cream products under supermarket and other customer brands as well as under the Loseley, Yorkshire Dales and Thayer’s brands.

Hill Station manufactures and markets super-premium ice cream under the Hill Station brand.  It produces a retail range of 11 flavours and a foodservice range of 13 flavours.

Hill Station’s strategy is to position itself as an efficient manufacturer of a broad range of ice cream products capable of responding to own-label customer demand across the product quality and price spectrum as well as in branded sales. The company said it believes that the acquisitions will deliver a number of key benefits including: the creation of a new, broadly-based, and commercially credible manufacturer in the UK ice cream sector; putting the enlarged group in a strong position to compete against other established manufacturers for both own-label business and branded sales; enhancing its competitive position with customers by extending the group’s operations through all segments of the ice cream market; and achieving significant operating efficiencies and overhead reductions .

Hill Station will relocate its current operations to the new state-of-the-art production facilities at Loseley’s 80,000 sq ft site at Cwmbran, South Wales.
“These acquisitions will result in a major transformation of Hill Station from a niche manufacturer of branded products to a broadly-based player in the ice cream sector,” said Charles Hall, Hill Station’s group managing director.