By Chris Brook-Carter and Katy Humphries
Tayto is to acquire part of the beleaguered Golden Wonder business, in a deal that is expected to be announced tomorrow (13 January), just-food understands.
It was announced on Monday that Golden Wonder was being put into administration, with administrators Kroll in discussions with third parties to sell the business.
An industry source today told just-food that the Northern Ireland snacks group would be acquiring Golden Wonder’s Corby production site as well as the contract to produce Mini Pringles from the facility on behalf of Procter & Gamble.
It was previously expected that Tayto would acquire some of the Golden Wonder brands, but the source confirmed today that this would not be the case.
Instead, the rest of the Golden Wonder business, including the brands, the own-label business and a restructured Scunthorpe production facility, would be put up for sale separately.
just-food was told today that there had been plenty of interest in the remaining Golden Wonder business, with United Biscuits, the owner of rival snack producer KP, and a number of venture capital groups among the runners.
However, the source also said that former Golden Wonder CEO Clive Sharpe had entered into discussions to launch a bid with venture capitalist backing. Ten years ago Sharpe led a £68m (US$119.7m) management buyout of the snack business from the former owners, the Dalgety Group.
John Band, food analyst with research group Datamonitor, told just-food: “PepsiCo would be the front runner, except competition law prohibits them from buying. Beyond that it’s not entirely clear who would be interested because Golden Wonder found it hard to compete based on their brand names alone. Possibly, someone in Northern Europe would take the opportunity to enter the highly competitive UK snacks market, but that would be an extremely brave decision. Otherwise, a supermarket may want to convert Golden Wonder to a private label.”
Golden Wonder was put into administration, having made significant losses in 2005, according to Kroll. The 2005 loss comes on the back of reported losses in 2004 of £10.8m on sales of £87.8m.
The company, as well as producing own-label products for a number of leading supermarkets and its Golden Wonder and Golden Skins line of crisps, also has Nik-Naks, Wheat Crunchies, Golden Lights and Ringos amongst its brands.
Tayto were unvailable for comment as just-food went to press.