The distributor, which delivers to a large number of Compass’ UK foodservice outlets nationwide, is thought to be partly responsible for Compass’ recent profit warning, in which the company cited the financial difficulties of one of its major UK distributors as a key factor in a £30m reduction in operating profit for 2004.
Peter’s Food Service’s food manufacturing division in Bedwas, Caerphilly, is not part of the deal. Compass Group would not comment on reports that it had been shoring up Peter’s with up to £800,000 a month since January in a bid to keep it afloat.
Companies House filings reveal Peter’s had experienced problems integrating Glanbia’s UK foodservice distribution business, which it acquired in 2002, while the accounts show it posted a pre-tax loss of £5.67m on continuing operations for the year to May 31, 2003.
Group finance director David Peek said: “I can confirm that we are in discussions with Brakes regarding the disposal of our chilled distribution division based in Tamworth. While negotiations are in progress we are not prepared to comment further.”