One of the UK’s largest own-label cake and pastry manufacturers has been snapped up by a private equity firm in £23.5M management buy-in deal (MBI).
McCambridge Group’s cake division – which bakes one in 10 of every retail pre-packed ambient cakes and pastries – is now in the hands of NGBI Private Equity.
The sale of the cake division, complete with its bakeries in Manchester, Bradford, Blackburn, Salisbury and Szczecin, Poland, will not affect the 637 UK-based jobs or 259 positions in Poland, a spokeswoman told FoodManufacture.co.uk.
The deal for the firm – which produces almost 500 different bakery and confectionery products each year – follows the announcement of talks with an unnamed party in October
Following the sale of the business, McCambridge will continue to focus on further growth and development at its two remaining businesses, which are not included in the sale.
These are Soreen, the market leader in malt loaves and fruit loaf products and the McCambridge bakery business in Ireland, which is the market leader in soda bread in Ireland.
Simon Webber, chairman of the McCambridge Group, said: “The cake division has great growth potential. A strategic review coupled with approaches from interested parties led us to establish that the division would benefit from being demerged and managed as a separate entity.
“We are delighted the business has been sold to NBGI Private Equity, which has a track record in owning businesses in the food industry. The successful sale of the Cake Division is a great credit to all management and employees.
“The group’s focus will now turn to the two remaining divisions and we will continue to develop these business units on the back of the excellent work the divisions have completed already.”
NGBI Private Equity - which also has majority stakes in food service businesses Pasta King and Peter’s Food Services – has appointed Andrew Johnson as the cake division’s new chief executive.
Johnson has extensive experience in growing businesses supplying own-label foodstuffs into supermarket multiples in the UK.
He was chief executive in a successful buy-in into Elisabeth the Chef in 2004, a private equity-backed supplier of chilled own-label cakes to UK supermarkets, growing sales from £45M to £70M during his three-year tenure.
Johnson said he was eager to seize the initiative and make the firm the pre-eminent cake manufacturer in the UK food industry by providing industry-leading levels of innovation, quality and service.
Richard Babington, investor director of NBGI Private Equity, who sourced and led the transaction, said: “We are delighted to be backing Andrew in his second MBI into the food sector after a long search, working closely with him, to identify the right buy-in opportunity for his skills. He has a highly successful track record in growing own-label businesses supplying the UK supermarket multiples, which I am confident will be extended with this investment.”