Food giant Valeo to gobble up Kettle crisps and hit $1bn sales
Fast-growing Valeo Foods Group, which specialises in snapping up 'retro sweets' brands, has struck a deal to buy the European crisps business of Campbell Soup in a deal worth £66m (€73m) that it said would push its global sales close to $1bn.
Valeo was set up in 2010 by Cavan-born dealmaker Seamus Fitzpatrick, the founder of the €4bn CapVest private equity group, and since then it has had a nine-year buying spree that has seen it complete 12 acquisitions.
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Valeo Foods' menu of top name brands already includes Rowse Honey, Barratt, Jacob's, Fox's Glacier Mints, and Balconi. "The proposed acquisition of Kettle Foods will add approximately €115m to Valeo Foods' current annual sales of over €850m," the company said in a statement.
The deal still needs to be approved by regulators and Campbell Soup will retain the brand in the US.
Valeo already employs over 3,000 people in Ireland, the UK, Czech Republic and Italy, and the crisps purchase will bring another 500 across the UK and the Netherlands.
A series of deals, such as the €110m purchase of confectionery group Tangerine - whose brands include iconic Irish brands such as Fruit Salads and Refreshers as well as Barratt's Sherbet Fountain - and the €100m it paid to Finland's Raisio for its confectionery arm that made Fox's Glacier Mints, have made it a force to be reckoned with.
Tangerine had been owned by US private equity firm Blackstone.
A shift away from traditional sweets to the faster-growing health foods segment has created a shakeout among the portfolios of some of the world's biggest food companies and, in the process, opportunities for private equity firms such as CapVest and Blackstone, which often look for companies and brands with stable cashflow.
"This acquisition is consistent with our long-term goal of building a dynamic international portfolio of attractive, resilient and popular food brands that consumers love to enjoy," said Seamus Kearney, Valeo's CEO.
Consumer staples are often viewed as good 'defensive stocks', which can weather times of economic uncertainty. The redrawing of the confectionery industry has seen some painful changes and Kraft's acquisition of Cadbury's led to plant closures.