Cranswick announces Grove Pet Foods acquisition

Grove Pet Foods produces dry dog food for several leading brands under private label relationships alongside its own brands including Vitalin (natural) and Alpha Feeds (working dog). The business operates predominantly from a purpose-built freehold facility in Lincolnshire and employs a total workforce of approximately 100.

The company claimed sales of £21.5m in the year to December 2020, with an operating margin of 10%.

John Walgate, managing director, who has a wealth of experience in this attractive category, would remain with and continue to lead the business, according to Cranswick.

Commenting on the acquisition, Clive Black, director and head of research at Shore Capital: "The pet food sector is already supplied with fifth quarter goods from Cranswick's primary production activities and so Grove will provide scope for synergistic value added as margin is retained within the group.​

'Rising pet ownership'​

"The pet food market has been a silver lining from the Coronavirus pandemic, gaining a notable boost from the increase in ownership as many folks sought the companionship of a dog or a cat. With rising pet ownership, UK volume demand for pet food has increased, as evidenced by the strong recent performance of specialist retailers of Pets at Home.​

"Additionally we also sense that pet food market trends are encouraging with premiumisation an evident feature, which is challenging the position of incumbent leading proprietary brands and increasing the value added of the category."​

The acquisition of Grove Pet Foods comes just over a year after Cranswick withdrew from acquiring Inspired Pet Nutrition on 17 December 2020.

Diversification​

The acquisition was consistent with Cranswick's three-pronged strategy of consolidation, diversification and internationalisation and was further evidence of the company's diversification, Black said. "The Grove acquisition sits alongside material workstreams from Cranswick in recent years that have seen the group effectively build out beyond primary pig meat processing into agriculture, feed milling, primary poultry, added-value pork and poultry, continental, pastry and now pet food."​

Adam Couch, chief executive officer at Cranswick, commented: “I am delighted to announce the acquisition of Grove Pet Foods, a well-invested manufacturer of dry pet food supplying leading brands focused on the specialist pet retail market.​

'Complementary category'​

This acquisition represents a platform for future growth in the attractive UK pet food market and diversification into this complementary category for Cranswick. The existing facility has capacity and a footprint for further expansion.​ ​

“Grove Pet Foods has built a reputation for high quality products and service that is well-aligned with Cranswick. The combined business will benefit from vertical integration opportunities within the group and particularly our fresh poultry and pork businesses. We look forward to building on this and continuing to invest in the product range, facilities and the team over the years ahead.”​

Cranswick recently claimed the acquisitions of plant-based firm Ramona's Kitchen and Spanish tortilla supplier Atlantica UK afforded it 'exciting opportunities' to develop its rapidly expanding continental products business.

Fresh food​

Supplying premium, fresh and added-value food products, Cranswick employs more than 13,000 people. It was formed in the early 1970s by farmers in East Yorkshire to produce animal feed and has since evolved into a business which produces a range of high quality, predominantly fresh food, including fresh pork, poultry, convenience and gourmet products.

The Group supplies major grocery retail chains as well as the growing premium and discounter retail channels. It also has a strong presence in the food-to-go sector and a substantial export business.