There won’t be quite the same outcry as there was over Cadbury, and hopefully not the same borderline-xenophobic headlines in some of the papers. But another UK confectioner today began the wearingly familiar move to foreign ownership, as Zetar’s board recommended a £42.7m offer from German food group Zertus.
“Nobody’s dying,” stressed Zetar chairman David Williams, in case there was any doubt. “This business is just going to be part of a bigger group with more access to cash. It’s not a question of them coming over, closing everything down and moving it to Germany.”
Either way, Zetar has long been vulnerable, its share price stubbornly refusing to pick up despite a solid enough performance in a tough market. Indeed, just two days ago, The Grocer picked out Zetar as “the next target for consolidation” in the category.
In Saturday’s bumper Focus On Confectionery, we asked how some of the category’s smaller players were thriving despite huge structural change in the past decade. For some, the answer has been to play the big boys at their own game, snapping up rivals further down the food chain. That has long been Zetar’s strategy, although with the share price where it was, a return to the acquisition trail proved impossible.
The board said today it had “identified a number of target acquisitions” but admitted that it didn’t have the firepower to make them happen. The directors also conceded that the 26% premium Zertus was offering was something its shareholders “might not was otherwise obtain in the short to medium term… taking account of the relative illiquidity in Zetar shares”. Zertus, for its part, promised to safeguard jobs of Zetar’s staff (and those of its directors, happily).
While some may bemoan the passing of another British company into foreign hands, those tired of swimming against the tide may be relieved that for Zetar, at least, ze war is over.