Kerry secures Australian bakery firm in €20m deal
KERRY Group has made another acquisition, this time in the form of a lifestyle bakery company in Australia.
The Irish giant has bought the frozen bakery business from General Mills for an undisclosed sum, believed to be in excess of €20m.
The deal will see Kerry buy Croissant King and Van den Bergh's bakeries. The product range of the two businesses is frozen dough and frozen pastry products, with Kerry taking over two factories as part of the deal. The bakeries employ a total of about 120 people.
The acquisition adds to the company's Kerry Pinnacle business in Australia, which already provides in-house pastries for supermarkets in Australia similar to the likes of Cuisine de France here.
General Mills said it was selling the firms in order to concentrate its remaining bakery interests on retail brands.
News of the acquisition was broadly welcomed by analysts, who see it as a natural fit for Kerry's Australasian business.
"The acquisition will complement Kerry's existing bakery ingredients," said Liam Igoe of Goodbody stockbrokers.
"Only in Australia and New Zealand has Kerry bakery interests such as specialist ingredients, frozen dough and a range of frozen pastries to complement its existing Kerry Pinnacle ingredients and baked goods activity in Australasia," said John O'Reilly of Davy Stockbrokers.
"It can be inferred that there is no intention to internationalise it, but there may be opportunity to grow the business within Asia Pacific.
"Kerry views primary and regional ingredients as an important adjunct to its major ingredient technologies," he added.
The acquisition is the latest in a long line of acquisitions by Kerry, who completed the purchase of Newmarket Creameries earlier in the year.
By late afternoon in Dublin Kerry was down nearly 1pc at €25.25.