This follows Premier Food's recent roll out of its new Ambrosia porridge pots, as it sets its sights firmly on expanding its offering for the first meal of the day.
The fast growing FUEL10K brand has witnessed strong double-digit revenue growth over the last three years, and Premier Foods anticipates it will be able to ‘unlock signification future value’ with its ‘on-trend’ proposition of granola, oats and drinks products.
“Possessing a differentiated category position, with its protein enriched product range and appealing to a younger demographic, we expect to deliver significant further profitable growth of FUEL10K through the deployment of our successful branded growth model,” commented Alex Whitehouse, CEO of Premier Foods.
The purchase of FUEL10K for £34m represented a 1.6x sales on projected revenues of £21m for the year ended 31 March 2024.
Premier Foods will initially pay £29.6m, funded through cash reserves, with an additional £4m, minimum, to be paid in the financial year of 2026/27. Any further payment will be dependent on growth targets.
Offering his thoughts on the acquisition, FUEL10K’s co-founder said: “We are very excited to be passing the reigns on to the owner of such a great stable of UK brands.
“Having built the foundations from start-up, the FUEL10K brand is now primed to accelerate into the future and achieve even more great things. I could not think of a better custodian of our brand than Premier Foods to entrust what we have begun and make the most of such a great opportunity.”
This is the second acquisition Premier Foods has made in just over a year, following its purchase of The Spice Tailor in July 2022 for £43.8m.