Monday 23 September 2019

Salad days: Greencore buys up €62m UK food producer

Greencore's Patrick Coveney
Greencore's Patrick Coveney
Ellie Donnelly

Ellie Donnelly

Greencore has acquired Freshtime, a manufacturer of convenience foods in the UK, for £56m (€61.7m).

In the 12 months to December 2018, Freshtime generated revenues of £66m (€72.7m) and profit before tax of £5.6m (€6m).

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Greencore, headed by Patrick Coveney, already distributes a large proportion of Freshtime's products through its direct-to-store network across the UK.

The purchase will be funded from existing debt facilities, and Greencore expects to remain within its medium-term leverage range following the transaction.

Commenting on the deal, Mr Coveney (pictured) said it was "an excellent strategic fit" for the group.

Earlier this year, Mr Coveney said Greencore, which manufactures about 706 million food-to-go items, including sandwiches, every year, would pursue expansion in the UK market organically but also via a significant number of small-scale acquisitions.

Analysts yesterday said they expect bolt-ons to become central to Greencore's capital allocation playbook.

"We see 3pc-plus upside to our financial year 2020 earnings per share," Roland French of Davy Stockbrokers, added.

Shares in the company were up less than 1pc in afternoon trading yesterday.

Irish Independent

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