January 25/Middlesbrough, England/Evening Gazette -- Premier Foods has sold its Quorn operation, which has 340 staff across its Billingham and Stokesley operations.
The foods giant accepted a bid of 205 million pounds from Exponent Private Equity and Intermediate Capital Group for its meat-free division, which also includes the Cauldron brand, ending months of speculation over plans for both brands. Premier said the structure of the business, including staff, will remain the same following the sale and Chris Graham, founding partner of Exponent, which has stakes in thetrainline.com and bed store Dreams, said the firm plans to grow the meat-free business further with additional investment.
It has been weighing up its options as it looks to alleviate a 1.4 billion pound debt pile built up following an acquisition spree that included Hovis owner RHM and Campbell's Soup in U.K. and Ireland.
Quorn was purchased for 172 million pounds from Marlow Foods in 2005. The first Quorn product was launched in 1985 using a specially developed protein-based ingredient called mycoprotein, and it has since become a popular meat substitute for vegetarians. Cauldron offers a range of tofu products and vegetarian sausages.
Premier said in the year ending December 31, the meat-free division made revenues of 128.8 million pounds and a trading profit of 16.2 million pounds.
Robert Schofield, chief executive at Premier, said, ''We are pleased to have concluded this sale agreement. It makes a significant contribution to reducing our debt.'' He said the deal was a ''step along the road to achieving a capital structure which we believe will be more attractive to investors."
He added, ''It will also enable the business to focus further on building our current portfolio of great British brands.'' Shares in Premier Foods were up nearly 2% following the announcement.
From the February 7, 2011, Prepared Foods E-dition