The purchase of the Leeds-based ambient food manufacturer includes well-known snacking brands such as Mug Shot, Naked and Ragu. Symington’s also produces own-label products for top supermarkets.
Rumours surrounding the sale of Symington’s began circling in February this year, with a price tag of between £80m to £100m reportedly on the table. However, there were doubts that the ambient food producer would secure a deal at the higher end of the scale.
In a presentation on the deal, Newlat said Symington's UK distribution platform was at operating at roughly 70% capacity and 'could be used for the distribution of Newlat's food pasta and bakery category'.
Newlat added: "Symington’s is purchasing circa £7m of pasta as raw materials. Newlat Food has c.40% of spare capacity and the industrial knowledge to cover all recipes and formats."
The company claimed Symington's existing trading relationship with Walmart in the US could be developed through the addition of Newlat products.
"The optimization of the capacity could leave one of the Symington’s production plants free to become a pure pasta production plant," it added.
David Cox, Symington’s chief executive, said: “Newlat wants to invest in our business and our brands. It provides long-term security for our business with an international ambient and dairy food player operating in mutually beneficial categories and is an exciting time for us both.
“By bringing together both businesses we can combine our strengths, accelerate our growth and increase our global footprint. Symington’s provides a strong springboard for Newlat’s brands into the UK market and Newlat gives us further opportunities for us to grow our brands internationally where Newlat has operations – in Italy and Germany.”
Listed on the Italian Stock Exchange, Newlat is one of Italy’s largest producers of milk and milk products, pasta and baby food and employs more than 1,500 members of staff across 14 production plants in Italy and one in Germany.
Newlat chairman Angelo Mastrolia added: “This is an interesting business with high potential for growth and we deem it to be a perfect fit into our strategic plan. We see a number of synergies between our businesses as we both produce complementary but different categories of products.
Setting foot in the UK
“Not only will there be significant cost synergies but also, this acquisition allows us to enlarge and diversify our product range and our geographical reach. This opportunity enables us to set foot into the UK and thus consolidate our position in this extremely relevant market.
“We are ready to invest in the business and to support its international expansion.”
Symington’s employs about 900 people across four locations (three factories and one distribution centre) in Leeds, Bradford and Durham. Last year, it reported a sales increase of 4.2% to £114m and a 17.5% uplift in earnings before tax, interest, depreciation and amortisation to £9.2m.
Meanwhile, healthy snack bar manufacturer Wholebake has been acquired by investment fund Elysian Capital III, as part of the latter’s purchase of parent company Healthful Holdings Group from Bridges Fund Management.