Richmond buys Allied ice cream

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Frozen foods supplier Richmond Foods has served up a treat to investors after doubling in size in an £18.8m deal to buy the ice cream business of Allied Frozen Foods. The deal was struck to develop Richmond's relationship with the major multiple retail chains ­ with an eye to tackling the volumes demanded by the likes of Wal-Mart. Richmond produces both own label take home products such as tub ice cream and handheld ice lollies, and also for the impulse market under the Treats, Chewitt and Ribena brands. It already supplies Asda, Morrisons and Tesco, but chief executive James Lambert said: "In this business you either eat lunch or you are lunch. "Buying the frozen food business of AFF enables us to expand our business to be able to supply products on a Europe-wide scale. "It will also give us a foothold in the fast growing foodservice market and will allow us to manufacture some of the products we currently purchase overseas for the Treats brand business in the impulse market." The company will also use the purchase to develop its product range, expand on product development and reduce purchasing and distribution costs. The AFF ice cream business is a leading UK manufacturer of ice cream products in the UK retail and foodservice markets. The business has a broad product range, including choc ices, filled cones, extruded products, deserts, frozen mousses and tub and premium ice cream. It operates four manufacturing sites in the south of England, with the biggest in Ashford in Kent, employing around 500 people. Turnover for AFF Ice Cream Business in the year ended September 18 1999 was £48.4m, with an operating profit of £286,000. The deal is subject to Office of Fair Trading approval. If it is ratified, the newly combined business will command a quarter of the £400m a year retail ice cream business, according to Lambert. {{NEWS }}

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