Hilton Food Group has sold its foodservice meat business, Fairfax Meadow Europe, for £54m – double the price it paid for it four years ago.
The sale to Sysco is part of Hilton’s decision to refocus on its core strength of partnering on meat with leading retailers like Tesco.
Hilton bought the business for £23.8m in 2021 as it sought to expand into the UK’s foodservice sector in the wake of easing Covid restrictions.
This has now been reversed, with the company’s core retail sales proving its main source of growth.
“At Hilton Foods, our objective is clear, to build on the strengths that have long defined our business,” said CEO Steve Murrells.
He added that by refining the portfolio and focusing resources, the business was creating the “greatest opportunities” to deliver sustained growth and long-term returns.
The sale will reduce Hilton’s annual profits by about £5m each year and result in a 6% reduction in earnings, according to Peel Hunt analysts.
For Sysco, Fairfax Meadow was a “crucial next step” in expanding its meat supply for foodservice customers across the UK.
“We believe this is a complementary fit for Sysco GB, strengthening our fresh meat proposition across the country and bringing even greater value to our customers,” said Sysco GB CEO Paul Nieduszynski.
Hilton’s share price fell almost 20% earlier this month after it revealed disruption in its fish business led to a fall in the company’s profits.
High inflation meant seafood sales fell in the UK, while Foppen, its smoked salmon business, was hit by regulatory restrictions on shipments to the US from its Greek facility.
The FTSE 250 company is now focused on an international expansion, entering a joint venture with the National Agricultural Development Company (Nadec) in Saudi Arabia in May, and signing a deal to supply Walmart in Canada.
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