Real Good Food PLC Acquisition of majority interest in Brighter Foods (5903B)
05 April 2017 - 4:00PM
UK Regulatory
TIDMRGD
RNS Number : 5903B
Real Good Food PLC
05 April 2017
Strictly Embargoed until 07.00: 5(th) April 2017
Real Good Food plc
("the Group" or "Real Good Food")
Acquisition of majority interest in Brighter Foods Limited
("Brighter Foods" or "the Company")
Real Good Food plc (AIM: RGD) and Tywyn based Brighter Foods
announce a new partnership to build on the success for the Wales
based food manufacturing company, with Robin Williams remaining as
CEO. Real Good Food plc has acquired an 84.33 per cent interest in
Brighter Foods for total consideration of up to GBP9 million, on a
cash and debt free basis, to be paid in two equal instalments 50
per cent on completion and 50 per cent upon finalisation of the
Company's 2017/18 audited accounts. The consideration will be
satisfied from the Group's existing debt facilities. The
acquisition is expected to be immediately earnings enhancing to the
Group.
Brighter Foods creates and manufactures snack bars for the
healthy snacking market from its factories in Tywyn, Gwynedd in Mid
Wales, where it is a major local employer with some 170 full-time
staff. The award-winning company produces snacks which are targeted
at areas such as diet control, gluten free, lactose free, low or no
added sugar, sports nutrition, organic and fair trade. Brighter
Foods manufactures both partner branded products and has its own
healthier brands such as Wild Trail which is stocked in major
retailers and health stores.
Brighter Foods commenced trading in April 2014 and has grown
impressively under the leadership of an experienced senior
management team, and the dedication of the skilled factory staff,
led by founder and CEO Robin Williams. Following completion of the
transaction senior management of Brighter Foods will retain a 15.67
per cent stake in the business (the "Management Stake").
Commenting on the transaction Robin said: "I have known Pieter
for years and have worked with members of his team previously and
I'm very pleased to be doing so again. They share our vision to
invest in the business and to grow it further from the strong base
we have established. I'll be staying as CEO and together we have
already agreed a headline plan to continue growing our
manufacturing facilities in Tywyn. This is great news for the town
and its people. Real Good Food recognises the importance of good
people in business and the importance of the factory to the local
community and I am really delighted that this partnership will
build on our success to date."
Pieter Totté, Executive Chairman of Real Good Food, added:
"Brighter Foods fits well into our strategy to consolidate
profitable well run businesses in niche areas of the food
manufacturing industry. Robin and his team have achieved fantastic
growth and stability in the business and we are looking forward to
continuing the success story. Real Good Food investment will enable
Brighter Foods to expand and improve its capacity and product range
even further. We are excited about the future prospects."
The Group has also entered into a separate shareholder agreement
regarding the Management Stake whereby the senior management of
Brighter Foods can elect to sell 50 per cent of the Management
Stake to the Group after March 2020 and 50 per cent after March
2021. The consideration for the entire Management Stake will be
based upon an agreed valuation formula, linked to profit before
interest and tax of Brighter Foods in the years ending 31 March
2020 and 31 March 2021 respectively, and is capped at GBP8 million
in aggregate. Additionally the Group can elect to acquire the
Management Stake after March 2021 based upon the same valuation
formula. For the 12 months to 31 March 2016, Brighter Foods
reported profit before tax of GBP2.3 million and net assets of
GBP2.7 million as at 31 March 2016.
-Ends-
About Real Good Food plc
Real Good Food plc is a diversified food business serving a
number of market sectors including retail, manufacturing,
wholesale, foodservice and export. The Group focuses on three main
markets: Cake Decoration (Renshaw, Rainbow Dust Colours), Food
Ingredients (Garrett Ingredients and R&W Scott) and Premium
Bakery (Haydens and Chantilly Patisserie).
ENQUIRIES:
Real Good Food plc
Pieter Totté, Executive Chairman Tel: 020 38573900
David Newman, Finance Director
Andrew Brown, Marketing Director
finnCap Ltd (Nomad and Broker)
Matt Goode Tel: 020 7220 0500
Carl Holmes
Daniel Stewart and Company Plc (Joint Broker)
David Lawman Tel: 020 7776 6550
Jonathon Webb
Belvedere Communications (PR)
John West Tel: 020 3567 0510
Kim van Beeck
This information is provided by RNS
The company news service from the London Stock Exchange
END
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