Whitworths, the dried fruit, nut and seed supplier, has received a big cash boost after private equity firm Equistone Partners Europe Fund IV acquired a major stake in the Midlands-based firm.
Equistone Partners investment will enable Whitworths to develop its product ranges, said the fruit, nut and seed supplier
The deal, which values the Whitworths business at £90M, will fuel the firm's expansion plans, according to Whitworths' chief executive Peter Utting.
"Together with the management team at Whitworths, I have enjoyed building the company over the recent years to its current scale and reputation," said Utting. "We are excited to work with the team at Equistone to explore new opportunities, and we are committed to continuing to deliver our exceptional product range and service to our current and prospective customers."
30% market share in its category
The Northamptonshire-based firm founded in 1886 supplies branded and own-label dried fruit, nut and seed products and has about a 30% market share in its category, said a statement from Equistone.
"The category has grown impressively through the economic downturn, achieving 7% growth per annum, as the popularity of healthier food alternatives and home baking continues to increase," it said. Total sales in the year to April 2013 reached £157.3M.
The key to Whitworths' success was repositioning the business as "the clear category captain" in the dried fruit, nut and seed sector for major UK retailers, said the private equity firm.
Joyce Church, of Equistone, said: "Whitworths stands out as the market leader in dried fruit, nut and seed products, a category with attractive dynamics. The management team has delivered on its strategy to date, and we look forward to working with them to help the business continue to develop, expanding distribution and product offering."
Growing branded proposition
The investment will be used to develop the product range to address new usage occasions – such as out of home snacking – and to develop further Whitworths' growing branded proposition, under multiple brands, as well as providing scope to acquire complementary businesses, she added.
Equistone is a mid-market private equity manager. It acquired its stake from European Capital and this represents its fourteenth investment.
A previous investment in the food sector was in Charles & Alice, the French manufacturer of fruit desserts.
Debt financing for the deal was provided by HSBC, Barclays and Royal Bank of Scotland.
Stuart Grantham, HSBC director of the leveraged finance team, said:"Whitworths is the UK's market leader in its sector and has excellent relationships with the major UK multiple retailers.
The business has shown great resilience in recent years as the popularity of healthier food alternatives and home baking continues to increase and has a clear market leading position which makes it an attractive proposition both as an investment opportunity and from a debt financing perspective."
