Hula Hoops and Skips manufacturer KP Snacks has extended its reached into the popcorn category with the acquisition of market leader Butterkist for an undisclosed sum.
Butterkist’s manufacturing site in Pontefract, West Yorkshire and its 140 employees will become part of the KP Snacks business.
The bagged snack supplier purchased the popcorn brand from private equity-owned Tangerine Confectionery, which put the business up for sale in 2016. The sweets division of Tangerine, which includes retro sweets such as Sherbet Fountain, Black Jack and Fruit Salad, will continue to be owned by Blackstone.
KP Snacks CEO Mark Thorpe said: “Butterkist is an iconic brand with a 100-year heritage and the number one branded popcorn in the UK. I am delighted that we have this opportunity to add Butterkist to our existing portfolio, which includes McCoy’s, Hula Hoops, Pom-Bear and KP Nuts, as we seek to offer consumers and customers a comprehensive UK snacking category proposition. We look forward to welcoming our new Pontefract colleagues and the Butterkist brand to KP.”
Tangerine CEO Anthony Francheterre added: “We are proud to have been instrumental in Butterkist’s development and pleased to pass the baton to KP Snacks to continue its success story. We believe this announcement is good news for both parties and confirms Tangerine’s focus on sugar confectionery, accelerating the development of our iconic brands Barratt, Dip Dab, Fruit Salad and building a stronger category with our customers.”
The two businesses said it would be “very much business as usual” during the handover period.
KP is owned by German group Intersnack, which bought the snack maker in a £500m deal in 2012, and employs more than 1,600 staff in the UK across five manufacturing sites and head office in Slough.
KP Snacks were advised by Houlihan Lokey and Tangerine Confectionery were represented by Stamford Partners.
Tangerine owner Blackstone appointed Stamford Partners in in mid-2016 to cash in on the booming demand in the UK for popcorn.
The latest Grocer crisps, nuts & snacks category report in April revealed overall grocery sales of popcorn surged 11.2% to £129.1m as shoppers shifted from more traditional bagged snacks [IRI 52 w/e 25 February].
Butterkist is the market leader, far ahead of its rivals such as Metcalfe’s Skinny, Tyrrells and Propercorn, with value up 2% year on year to £46.5m [IRI]. However, growth is slowing across the category to more mature levels and Butterkist’s share has been eroded by the growing number of rivals in the market.
The acquisition by KP is the latest in a string of deals in popcorn and follows Kettle owner Diamond Foods takeover of Metcalfe’s, the £300m transaction by Amplify for Tyrells and the investment by Piper Private Equity and JamJar in Propercorn.