The deal is subject to adjustment, in relation to levels of working capital and net debt. This comprises £9.6m in cash and £2.4m of existing finance leases, Bakkavor said.
Haydens, which was established in 1976, is a manufacturer of sweet bakery products for the major UK grocery retailers. It also provides a distribution operation for one of the UK’s leading retailers.
The business operates from two sites in Devizes, Wiltshire, and has approximately 480 employees.
The business received a capital investment of £15m in the last 18 months, which transformed the bakery operations. This has added significant capacity, expanding the existing footprint and upgrading equipment and infrastructure.
Bakkavor said the acquisition would enable it to increase the breadth and depth of its desserts range, as well as allowing it to extend its offering into in-store bakery. It would also support the growth of its own desserts business, which, combined with the ongoing major expansion of its facility in Newark, would provide increased and high-quality capacity, as well as state-of-the-art automation. It also said that incorporating Haydens into the business would provide “meaningful operational synergies”.
In the financial year ended 31 March 2017, Haydens generated £31.3m of revenues and was break-even at the operating profit level.
“We are pleased to welcome Haydens to the Bakkavor Group. It is a business which shares Bakkavor’s passion for providing outstanding service, quality and value to its customers and has a reputation for supplying some of the best-tasting sweet treats to the UK’s leading retailers,” said Agust Gudmundsson, chief executive officer of Bakkavor.
“This acquisition will grow both our capacity and product offering in the desserts category, and we are delighted to be welcoming Haydens’ management and the wider team to our business.”