The deal includes the transfer to Somerdale of AFF’s blended cheese processing assets, brands and associated trademarks. In doing so, it would reinforce its position as a leading supplier of blended cheese to more 30 countries across the globe, Somerdale said.
According to a statement released by the company today, the move would enable it to grow and develop its portfolio of blended cheeses developed specifically for the international marketplace.
Included in the transaction are the full rights to several well established brands, including Tintern and Harlech, which AFF previously produced in partnership with Somerdale. That allows Somerdale to give greater focus to these brands and the company said it planned to grow their sales through NPD, packaging and marketing activity.
As a result of the acquisition, Somerdale will transfer the production of blended cheese to its other cheese-making partners. That would include Cheshire-based third generation family-run cheese maker Joseph Heler, which already produces much of the cheese that features in Somerdale’s best-selling Westminster and Coopers Hill brands.
The deal's announcement comes at a time when Somerdale’s comprehensive range of classic and contemporary blended cheeses are in strong growth, with branded sales up 10.4% year on year. In addition to the brands acquired from AFF, these traditional names include Wensleydale & Cranberries; Somerdale’s Champagne Cheddar and Il Truffelino; plus flavours such as Cheddar with Chilli & Lime.
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“We are delighted to have acquired the assets of AFF’s blended cheese business," said Alan Jenkins, director of Somerdale. "In particular, it will strengthen our position as the leading exporter of British blended cheeses and will enable us to give greater focus to the development of brands such as Red Dragon which is already one of our largest selling brands in the US market.
“Across established international markets such as North America and Australia and new emerging markets such as China sales of our branded blended cheeses are growing strongly."
Somerdale's ability to create strong flavour combinations and tailored and seasonal blended cheeses as well as to respond to growing consumer demand for quality, provenance and clean ingredients and labelling had helped fuel that growth, said Jenkins. "Our acquisition of the AFF blended cheese business will reinforce both our capacity and capabilities in this fast growing and dynamic part of the market.”
The Abergavenny Fine Food Company announced in December that it would end its production of flavoured, blended cheeses to focus on expanding and developing its exports and value-added lines. The business said it had experienced significant growth in the value-added sector over the past five years and had invested in supporting the development of its halloumi fries, mozzarella sticks and jalapeno poppers.
AFF secured a seven-figure finance package from HSBC UK last year to invest in value-added lines of its chilled and frozen dairy and plant-based appetisers, snacking items and vegan ranges, aiming to reach sales of £50m sales within three years.
Focus on its goats cheese
The company said it would continue to produce the goats cheese that was the first product it produced after it was founded in 1981. But it said last month that its range of Y-Fenni, Tintern, Harlech and St. Illtyd would only be available to consumers until 31st December, 2020. It appears that the deal with Somerdale guarantees the continued production of these brands.
Earlier last year, the business announced a board restructure to develop and implement its strategic plans. Experienced chief executive officers and growth strategists Andrew Lord and Jason Rees were appointed chair and managing director respectively, with the business’ previous managing director of 15 years Melanie Bowman stepping down from the role. Lord and Rees now also sit on the management board.
Rees said: “The decision to close this chapter has not been taken lightly, but strategically we must focus on more profitable, scalable products to reinforce our growth and future-proof the business. We are growing our domestic business with our retail and wholesale partners in the UK and our export markets have also increased from 8% in 2017 to 20% this year.
“This is an agile and resilient business, with a great team which will continue to evolve to meet our customer and market needs. These are exciting times with plenty of opportunities for AFF to pursue.”
Bowman's time with AFF
Bowman has worked with her family’s company for the past 35 years and made the decision to take a back seat, executive role. Under her guidance, the business has grown to a team of 195 full time staff, swelling to 240 at peak production times.
Having launched in 1981, AFF expanded into a Welsh Development Agency funded purpose-built food unit in 1989 and then a much larger premises in Blaenavon in 2007.
Based in Wellington, Somerset, Somerdale is a leading UK exporter of British cheese & dairy products. Now in its 31st year of operation, it exports British cheese to more than 50 countries and has sales of more than £41m.
The US is a core market for the business, with shipments leaving for New York every week. It has also grown in markets ranging from China and the Far East, the Middle East & North Africa and South East Asia through to Europe, the Caribbean and Australia.
The company has established supply partnerships with traditional, family-run producers focusing on premium cheese.