Greencore buys Home Made Brand Foods
April 30, 2008
by Eric Schroeder
NEWBURYPORT, MASS. — Greencore Group P.L.C., a European maker of convenience food and malt products, has entered the North American chilled convenience food market with the $44 million acquisition of Home Made Brand Foods Inc. (H.M.B.F.). Based in Newburyport, H.M.B.F. manufactures and supplies a range of fresh food products, including fresh prepared meals and salads, sandwiches and quiche. Its customer base includes leading regional retailers such as Stop & Shop, Hannaford and Publix.
"This is an excellent strategic deal for Greencore," said Patrick Coveney, chief executive officer, Greencore. "We are combining our proven operational capabilities in convenience foods, developed over 20 years in the U.K. market, with the emerging U.S. consumer and retailer demand for high quality, chilled prepared foods. We have spent the last two years on the ground and are excited by both the significant recent increase in the level of retailer investment in chilled food categories, and by the positive consumer response to these initiatives.
"H.M.B.F. represents a strong platform acquisition for us — a profitable, well run, regional leader with significant headroom for further growth."
According to Greencore, H.M.B.F. expects to generate approximately $40 million in revenues during the fiscal year ending Dec. 31, 2008. Depending on H.M.B.F.’s performance during the fiscal year, the purchase price may rise to $54 million from $44 million, Greencore said.
The H.M.B.F. management team will remain in place, and Greencore said it will relocate key personnel to the United States to develop its U.S. business. Fergal Leamy, currently development director of the Convenience Foods division, has been appointed c.e.o. of Greencore USA and will be joined by other leaders in the areas of chilled food manufacturing, supply chain and product development.
"The H.M.B.F. acquisition represents a significant opportunity for us to take advantage of U.S. market growth and to leverage our world class chilled food manufacturing expertise from the U.K.," Mr. Leamy said. "In particular, we will bring superior technical food standards and cost-efficiency measures to a developing segment in the U.S. We have seen that in response to positive consumer trials, many major retailers have begun to gear their business around chilled foods in store, in the supply chain and in marketing efforts, which is generating further consumer demand. These combined elements give us an attractive platform for our planned U.S. expansion."