Food company Raisio to acquire British Big Bear Group plc

Raisio announced it has signed an agreement to acquire British Big Bear Group plc for enterprise value of €95.3 million. The acquisition supports Raisio’s growth strategy to become the leading provider of healthy snacks in Europe, stated the firm.

Raisio expects to gain a stronger foothold in the branded snack and breakfast markets in Great Britain and Western Europe with the investment. Other than that, the acquisition will also strengthen the company’s position in the UK confectionery market. Great Britain becomes the largest market area for Raisio’s food business with €140-150 million annual net sales. Raisio is already present in the British snack market with Glisten acquired in 2010.

Raisio’s CEO Matti Rihko noted that with the acquisition of Big Bear Group, Raisio will strengthen its footprint in the markets in Great Britain and Western Europe, enabling the continued growth of the firm’s brand business. Big Bear has a very strong market position in interesting and suitable sized categories, said Rihko, adding that it complements extremely well the earlier acquisition of Glisten and brings the necessary critical mass for the future.

Rihko further said that Raisio’s growth is proceeding according to plan and the company will continue to be an active player in the acquisition market.

Nearly 70% of Big Bear’s net sales are generated by breakfast and snack products and 30% by confectionery. The company employs some 250 people and has production in two locations in Leicester and in Southall, London.

The Big Bear Group was founded in 2003 and has acquired traditional, well-known brands in Britain. In breakfast category, the company owns the brands Honey Monster, Honey Waffles and Sugar Puffs, in snack bars Harvest Cheweee and Fox’s in confectionery. The product range includes breakfast cereal products mainly for children’s category as well as healthy snack bars and cereal products with no artificial flavours or colours.

Big Bear Group is owned by the company’s senior management together with a group of institutional investors that sold the entire issued share capital of the company. Raisio is to finance the all cash transaction with its cash reserves and a loan of €52 million raised for the acquisition. Post the acquisition, Raisio’s financial assets will be €100 million, with an equity ratio of around 60%.

Big Bear Group will be integrated into Raisio’s Western European brand operations as of 4 February 2011. In conjunction with the acquisition Raisio will incur some €3.5 million one-off cost for the first quarter of 2011.

4 Feb 2011.