Wellness Foods has sold off its last remaining brand to South African cereal manufacturer Pioneer Food Group for £7.5m.
It follows a string of disposals by the group, which is backed by Irish horseracing tycoons John Magnier and JP McManus, going back to 2014, including Rowse Honey and Dorset Cereals.
Pioneer said the deal for healthy snack producer Stream Foods, which trades under the Fruit Bowl brand, was part of a plan to bolster its UK branded product range.
Listed on the Johannesburg Stock Exchange, Pioneer makes a range of food and drinks, specialising in cereals, and holds licences for Marmite, Bovril and Lipton Ice Tea in South Africa. It also owns UK private label cereal maker Bokomo, supplying granola, muesli and porridge to the big four supermarkets, as well as discounters Aldi and Lidl. Revenues increased 6% to R18.7bn (£1bn) in the 2015.
“The acquisition will augment and leverage the company’s UK private label portfolio and its recently upgraded manufacturing capabilities,” Pioneer said in a statement on the Johannesburg Stock Exchange. “Furthermore, Stream Foods also exports their core brand Fruit Bowl to China and Europe. Pioneer Foods has extensive competence in the fruit snacking category, which bodes well for the development of the category and its brand position.”
Wellness, which was formed in 2005 by two former Kerry Group executives, picked up Fruit Bowl in 2007 for price believed at the time to be between £15m and £20m.
The group has struggled under the weight of vast debts stacked up in a buying spree for upmarket brands, including Rowse, Dorset and Orchard House Foods, in the run up to the major economic downturn in 2008 and 2009. Losses came close to £30m before parent company Erbium Holdings injected more than £70m into the business to reduce debts and shore up the balance sheet in late 2009.
The sales of Rowse to Valeo Foods in May and Dorset to Associated British Foods in June 2014 netted Wellness £155.9m, clearing its historic bank debts.
Hain Celestial’s UK subsidiary snapped up juice maker Orchard House in December, leaving Fruit Bowl, which has sales of about £15m, as the only remaining business in the Wellness group.