FDBusiness.com

Canada-based Saputo Group, which is one of the top ten dairy processors in the world, has completed its £975 million acquisition of Dairy Crest, the UK dairy business. The acquisition will allow Saputo Group to increase its international presence and enter the UK market by acquiring and investing in a well-established and successful industry player with a solid asset base and an experienced management team. Saputo Group did not have any operations in Europe and so Dairy Crest provides an attractive platform for growth in the UK.

Headquartered in Montreal, Saputo Group is the largest cheese manufacturer and the leading fluid milk and cream processor in Canada, the top dairy processor in Australia and the second largest in Argentina. In the United States, the Saputo Group ranks among the top three cheese producers and is one of the largest producers of extended shelf-life and cultured dairy products.

Employing approximately 15,000 people, Saputo Group operates 62 plants and sells its products in more than 40 countries. For the twelve months ended 31 March 2018, Saputo’s consolidated revenues amounted to C$11.543 billion (£6.706 billion) and its net earnings amounted to C$853 million (£495 million).

Dairy Crest has transformed itself in recent years from a supply-driven commoditised business to a leading UK manufacturer of foods and added-value ingredients. Pivotal to this transformation was the sale, executed by Dairy Crest’s current management team, of its Dairies operation to Müller in 2015.

Dairy Crest manufactures and markets a portfolio of market-leading brands including Cathedral City cheese, Clover dairy spread, Country Life butter and Frylight cooking spray. It also produces ingredients for the high growth global infant formula market – demineralised whey powder, a by-product from the cheese-making process, and galacto-oligosaccharides (GOS), a lactose-based prebiotic which helps to improve gut health.

During the last financial year, Dairy Crest raised just under £70 million through a share placement to increase cheese production capacity at its creamery in Davidstow, Cornwall. The proceeds are also being used to enable the site to become self-sufficient in the supply of water and to improve energy resilience, thereby reducing its environmental impact.

Dairy Crest employs approximately 1,100 people in seven locations in the United Kingdom – five operating sites, an Innovation Centre on the campus of Harper Adams University and a Head Office situated in the outskirts of London.

For the twelve months ended 31 March 2018, Dairy Crest reported revenue of approximately £457 million, profit before tax (including exceptional items) of approximately £179 million and adjusted profit before tax of approximately £62 million.