The prospect of a sale of UK biscuit brand Fox’s by owner Boparan Holdings has been played down by sources familiar with the matter.
Reports surfaced before Christmas that the Fox’s brand could be placed on the block by Boparan, the company behind UK giant 2 Sisters Food Group. According to The Wall Street Journal, the poultry-to-ready meals maker had instructed investment bank Rothschild to contact potential buyers to gauge interest in the business. Fox’s was believed to be valued at around GBP250m (US$372m).
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A representative of Boparan told just-food that “this [speculation] has cropped up before over the years” but declined to comment specifically on the latest round of “market rumour”. A spokesperson for Rothschild declined to comment.
However, a source familiar with the matter confirmed Rothschild does act as advisers to 2 Sisters but stressed that there is “always” speculation around Fox’s because it operates in categories outside of 2 Sisters core protein business. The source said the biscuits business is performing well but added Rothschild “are not sounding buyers out widely at the moment”.
Boparan took control of the Fox’s business as part of its 2011 acquisition of UK peer Northern Foods in a deal valued at GBP341m. In its most recent financial update for the first quarter, which ran to 31 October, the company said the performance at Fox’s – part of its branded division – was “strong” despite a “competitive environment”. Boparan said revenues were up “substantially” over the period, with growth supported by new products, including the launch of Fox’s Chocolatey range.
Overall, however, 2 Sisters’ sales and profits have come under pressure from challenging market conditions in the UK and high financing costs to fund its rapid expansion, which included the acquisition of Vion’s UK business, as well as Northern Foods.
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By GlobalDataAt the start of its 2015/16 fiscal year, Boparan outlined a strategy of building a “better before bigger” business as it posted a further decline in first quarter sales and profit at 2 Sisters. As part of this drive, the company’s focus has been on delivering improvements at its poultry and meal solutions businesses. 2 Sisters announced an investment programme including a GBP150m spend to strengthen its poultry business and the investment of GBP55m in its meal solutions unit.
