A Cardiff-headquartered speciality bakery manufacturer has secured an additional £15 million finance package from HSBC UK and its other banking partners to support the acquisition of gluten free bakery business, Ultrapharm Ltd.
Finsbury Foods, which produces a broad range of high-quality bread, cake and snack products, has agreed an uplift on its current £45 million revolving credit facility (RCF) to make the acquisition. This takes Finsbury’s total borrowing to £60 million.
The existing £45 million RCF was agreed by banking partners HSBC UK, RBS and Rabobank in February 2018 to provide the business with a range of working capital facilities, with a further £45 million uncommitted finance facility available to support its acquisition strategy.
The acquisition of Pontypool-based Ultrapharm has enabled Finsbury Foods to take a space in the gluten free market, which will help broaden its current offer, allow it to supply into a larger number of supermarkets across the UK and provide the Group with a larger footprint in Europe.
Steve Boyd, Group Financial Director at Finsbury Foods, said:
“The acquisition of Ultrapharm is important for us as it accelerates our strategy to diversify within our bakery division by introducing new products, customers and channels. Ultrapharm represents a large step into the fast growing gluten free market, as well as a manufacturing presence in Poland. This has been made possible by HSBC UK and our other banking partners. The existing revolving credit facility has been pivotal to the smooth operation and organic growth of our business over the last six months and it gives us confidence to know that there is additional financing available to help us grow through acquisition when the opportunities arise.”
John Stradling, Head of Large Corporate South at HSBC UK, added:
“We’ve been working with Finsbury Foods as its lead banking partner for over 20 years and in that time we’ve seen the business go from strength-to-strength. The existing management team is very strategic in the way it approaches acquisition opportunities and this latest buy-out is no exception. Ultrapharm is a successful business with a proven track record in the gluten free market, which has now added another string to Finsbury’s long list of bows.”
The Finsbury Food Group comprises a UK bakery division and an overseas division. The UK bakery division has manufacturing sites in Cardiff, East Kilbride, Hamilton, Salisbury, Sheffield and Manchester – and since the acquisition, in Pontypool, Wales and Poland. The overseas division comprises Lightbody Stretz Ltd, which is 50% owned by Finsbury, supplying and distributing the Group’s UK-manufactured products and third party products, primarily to Europe.
Ultrapharm, which was established by the Ansell family in 1993, produces a large range of gluten free products, from seeded loaves to muffins and crumpets. It supplies to the retail trade directly from its site in Pontypool, Wales.