FDBusiness.com

United Biscuits is selling its KP Snacks business to Intersnack for an undisclosed sum. The combination creates a strong alliance with combined net sales of more than Eur2.1 billion (£1.7 billion) and 8,000 employees. The transaction is expected to close during the first quarter of 2013.

With annual sales of Eur1.5 billion and employing 6,000 people, Intersnack Group is one of the largest manufacturers of savoury snacks in Europe. The privately owned company is headquartered in Dusseldorf, produces about 400,000 tonnes of snack products a year and has businesses in 14 European countries.

KP Snacks is the number two snack manufacturer in the UK and famous for its iconic brands, including McCoy’s, Hula Hoops, KP Nuts, Space Raiders, Nik Naks, Wheat Crunchies, Skips, Phileas Fogg, Discos, Roysters, Choc Dips, Brannigans, Frisps, KP Crisps, KP Mini Chips and Cheese Footballs. In addition to these brands, the transaction includes, among other assets, KP’s UK manufacturing facilities and a head office. UB will retain ownership of its baked bagged snack brands manufactured in its biscuit factories including Mini Cheddars and Twiglets.

With an annual turnover of £280 million (Eur346 million), KP Snacks has shown consistent top and bottom line growth over the last five years. The company employs approximately 1,500 people.

Maarten Leerdam, Executive Chairman of Intersnack, comments: “We are very pleased to be teaming up with KP Snacks, which represents a strong and highly complementary fit with the Intersnack family of leading businesses throughout Europe. Intersnack is a strong believer in the power of iconic, local hero brands, and we aim to leverage these strengths for further expansion. As a privately owned company, we operate our business with a long-term view. As such, the joint know-how of KP Snacks and Intersnack will drive the development of these iconic brands.”

David Fish, UB Group Non Executive Chairman, says: “KP Snacks is an excellent fit into Intersnack’s existing operations. This exciting deal ensures that the KP brands continue as part of a major European Snacks business, which gives them the scale and support needed in a competitive market place. It also allows UB to concentrate its attention solely on continuing to develop and grow its baked biscuit and snack product range.”

The UK market is the largest and most innovative snack market in Europe. Further expansion in this market remains a key priority for Intersnack. “We appreciate the significance of acquiring a part of British heritage and the proposed transaction reflects our goal to accelerate the transformation of Intersnack’s strategic position in the UK. We look forward to working with the existing KP Snacks management team and employees to leverage this opportunity,” adds Maarten Leerdam.

Intersnack looks back at 44 years of successful history in the savoury snack business and has successfully acquired several companies in recent years. Intersnack, with Maarten Leerdam, Klaus Koester, Stephan Kuehne, and Johan van Winkel as its management board, strongly believes in maintaining local management and local production. It employs an operating model in which its individual companies are responsible for generating long-term value. This reflects Intersnack’s policy to work as closely as possible in the markets where the company is active.

In the UK, Intersnack has consequently built up its presence through a mix of organic growth and acquisitions. Intersnack UK, with a turnover of approx £80 million, offers a complementary fit with KP Snacks as the business is solely focused on savoury snacks, with brands such as Pom-Bear,PennStateand Percy Dalton’s. The competence and knowledge KP Snacks brings into the alliance will support the joint growth potential.