UK snack food firm Zetar has sold a loss-making snacks business to the unit’s chief executive in a deal worth almost GBP2.7m (US$4m).
Zetar, which makes a range of private-label snacks and confectionery products, said today (1 May) it had offloaded The Baked Snacks Company to a business controlled by the unit’s boss Mobeen Mehdi.
Mehdi’s business, Tilbury Property, has made an initial cash payment of GBP590,000 – some GBP100 for 100% of The Baked Snacks Company, with the rest to pay an inter-company loan.
Tilbury will pay GBP2.09m in instalments over the next three years.
The Baked Snacks Company makes a range of low-fat crisps and biscuits. In the year ended 30 April 2008, BSC made sales of around GBP2m and an adjusted operating loss of GBP900,000.
Zetar said the sale would help the business cut debts. “The disposal removes the company’s only loss-making subsidiary, enhancing its earnings and allowing management to refocus solely on continuing to grow the profitable confectionery and natural and premium snacks divisions,” Zetar said.