Brexit triggers sale of Reynolds stake in C&D Foods to Goodman
Pet food company founded 50 years ago by former Taoiseach Albert Reynolds
Businessman Philip Reynolds, son of former Taoiseach Albert Reynolds, has sold down his last remaining 15pc stake in the family business, C&D Foods, to beef baron Larry Goodman.
Reynolds told the Sunday Independent that Brexit had been the trigger for his exit from the company. He also is leaving the company after almost three decades as CEO.
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The company was founded by the late Albert Reynolds 50 years ago in Edgeworthstown, Co Longford.
Goodman's ABP Food Group first invested in the company in 2008.
It took a 50pc stake, helping C&D to fulfil ambitions to become a consolidator in the market and expand in Europe. The pet food company now has annual revenues of €500m and spans nine countries, employing 1,500 people.
Reynolds said that in excess of 40pc of the business remained UK-focused.
Under the 2008 agreement with Goodman, there was a put-and-call option under which both parties would review the business and shareholding periodically.
"I had always an opportunity to put my shares to ABP and they would have to buy them, and similarly there was a time when they could call on my shares and I'd have to sell them," said Reynolds.
Recently, the pair held a meeting regarding the shareholding.
"Larry and I had the conversation and our agreement, our understanding coming out of it, was that Brexit is a huge issue," said Reynolds.
"It is a huge issue for every business that trades in the UK and we're no different in that. We have to be Brexit-ready whatever that means and in whatever form Brexit takes.
"Did I think it was going to be now? Did I think it was going to be over this issue? No is the honest answer to that," said Reynolds. "It was all about what's right for the business and we both concluded from that the time - albeit not of our choosing - the time is right now."
He agreed with Goodman that having a minority shareholder would not be beneficial in the current environment. Reynolds said he and Goodman had enjoyed an extremely positive working relationship and that ABP's backing had helped the company expand and thrive.
"It's very, very tight margin [the business], we're dealing with the largest retail groups all across Europe, it's fiercely competitive, and, at times, like the finance crunch, no money available to do anything - and I'm not even talking about expanding, I'm talking about to run day-to-day businesses - you need somebody of the strength of an ABP to get you through that."
Pedigree, owned by Mars, and Nestle dominate the pet food sector with C&D Foods focusing on the private label business, which means it makes pet food branded for individual supermarket chains.
Reynolds said selling the stake was a very emotional decision given the family's history with the business. However, he now plans to invest in new business ventures.
Sunday Indo Business