The private equity owner of Bernard Matthews has put the turkey giant up for sale, PwC has confirmed.
Rutland Partners, which invested in Bernard Matthews in 2013, has hired the accountancy firm to search for prospective buyers as trading continued to prove challenging. It follows months of media speculation over the financial strength of the company, which employs close to 2,500 staff at sites in Norfolk and Suffolk.
Underlying operating losses at the iconic poultry supplier deepened to £2m and sales slumped another £30.1m to £276.7m in the year to 28 June 2015 as management fought to turn around the business. Net debt at the group stood at £77m at the year end, the accounts for Bernard Matthews Holdings Ltd showed.
An email from Rutland to staff at Bernard Matthews, reported by the BBC, called the results in the past year “disappointing”.
Established in the 1950s, Bernard Matthews has been in serious decline for the past 11 years, with attacks by Jamie Oliver on its Turkey Twizzlers, allegations of animal cruelty by staff and a bird flu outbreak culminating in losses hitting lows of £20.4m in 2012/13.
Turnaround specialist Rutland, which counts Maplin and Pizza Hut in its stable, saved the turkey producer in 2013 with a £25m cash injection – the first outside investor in Bernard Matthews’ history.
Just 18 months later, the private equity house sought additional outside financing to fund the turnaround battle. However, the latest accounts showed Rutland pumped another £10m into the business in August 2015 after the search proved fruitless.
Bernard Matthews CEO Rob Burnett, who took the reins at the start of the 2014/15 financial year, told The Grocer in June 2015 that he expected the group would be back in the black in 2016.
He highlighted the significant narrowing of pre-tax losses in 2014/15 – from £10m to £5.2m as exceptional costs were slashed from £4.7m to £72,000 – as a sign of progress. “For the second consecutive year our results have improved as we have continued to turn the business around,” he said in January when The Grocer reported on the accounts.
Unite called for “clarity” on the future of Bernard Matthews and its workforce. The union represents about 450 of the about 2,500 employees.
Unite regional officer Steve Harley said: “It is a worrying time for our members and we will be seeking clarity on what this means for the company and the workers when we meet management on Friday 15 July.
“Unite recognises that Bernard Matthews is in a very competitive marketplace with profit margins being squeezed. This issue is one for the management’s marketing and sales team to address as a matter of urgency.”
Rutland Partners and Bernard Matthews declined to comment on the search for a new owner.