Finsbury Foods has revealed it is on the lookout for acquisitions and has already walked away from one deal.

Announcing its first half results this week, Finsbury FD Stephen Boyd said the cake maker had the firepower to become a consolidator after selling its free-from business to Genius for £21m last month.

“We’ve already received a lot of calls and walked away from one deal because the price wasn’t right,” he said, adding that under investment and excess capacity had made the industry ripe for consolidation.

Finsbury also planned to invest in automation and to double capex for the cake business to about £4m a year in the next three years, he said.

The company reported a 32.8% hike in pre-tax profits for the six months to 31 December 2012. Although free-from sales had grown more strongly than cake, selling the business had been the right move, said Boyd.

”Warburtons had stated it would take the market seriously and Heinz was going in too. We would have needed to make significant investments, which would have been detrimental to the cake business,” he said.