Valeo set to buy Jacob Fruitfield in €80m deal to create €300m firm with 500 staff
A NEW giant in the Irish food market looks set to be created after Valeo Foods agreed to buy Jacob Fruitfield in a deal believed to be worth about €80m.
Valeo, which owns Batchelors beans and Squeez juices among other well-known brands, said yesterday it had agreed to purchase Jacob Fruitfield, the owner of Chef ketchup and Jacobs biscuits.
The new company will have a turnover of €300m and employ nearly 500 people.
Valeo is a joint venture between Origin Enterprises and London-based private equity firm CapVest. The company was created less than a year ago through the merger of Batchelors and Origin Foods.
Under the terms of the deal, which is being funded through cash, a vendor loan note and new equity, Jacobs managing director Seamus Kearney will become group chief executive of Valeo. The current Valeo CEO, Peadar Kearney, will leave the group once the deal is complete.
Jacobs chairman Michael Carey and Lioncourt Capital co-founder David Andrews -- who is a significant shareholder in Jacob -- will join the Valeo board as non-executive directors.
In a statement, CapVest founder and Valeo chairman Seamus FitzPatrick said the deal would grow the business and signalled his firm would continue to look for deals in the food sector.
"Given the very tough trading environment, growing the business to allow investment behind our brands makes strong commercial sense," he said.
"[This] acquisition is a significant step in what is likely to be an ongoing process of further consolidation in the Irish food sector. The enlarged Valeo that will emerge from this deal will be a more diversified and resilient Irish food company, well positioned for further growth," he added.
A successful sale would also be expected to provide a significant windfall for Mr Carey, who owns 54pc of Jacob Fruitfield.
Lioncourt founders, Michael Tunney and Mr Andrews, hold a 31pc stake in the company with the remainder split between current and former management.
Jacobs caused huge controversy two years ago when it closed its factory on the Belgard Road in Tallaght with the loss of 220 jobs after local councillors said they had been assured the factory would be retained.