Associated British Foods has completed the acquisition of Hovis

The Consumer, Retail and Leisure team of Arrowpoint Advisory, the UK mid-market team of Rothschild & Co, has advised Associated British Foods plc ("ABF"), on its acquisition of Hovis Limited ("Hovis"), a portfolio company of Endless LLP ("Endless").

ABF is a diversified international food, ingredients and retail group, with a range of food and ingredients businesses as well as a retail brand in Primark. ABF generates ~£20bn in revenues annually, employs 138,000 people, operates in 56 countries and is listed on the London Stock Exchange.

ABF's grocery division contributes ~£4bn of the group's revenues and comprises brands which occupy leading positions in markets across the globe. In the UK, nine out of 10 households use their brands. The grocery division is home to Allied Bakeries, a business that produces a range of bakery products under the Kingsmill, Sunblest and Allinson's brands.

Hovis is a baking business based in High Wycombe, UK, employing 2,800 people across eight bakeries, one flour mill and three distribution centres across the UK. Hovis delivers over a million loaves every day throughout the UK and Ireland across the Hovis, Mother's Pride, Ormo and other brands.

The acquisition of Hovis Group and its combination with Allied Bakeries, the UK bakery business of ABF, will create a sustainably profitable UK bakeries business for the long term with an enhanced market position.  The integration of the two businesses will commence shortly and is expected to deliver substantial operational synergies and efficiencies across production and distribution. These benefits will drive improved profitability, strengthen the resilience of the combined business and enable investment in brands and product innovation.

From 8 July, Allied Bakeries and Hovis Group will operate as Hovis Bakeries, under the brand line ‘Nourishing the Nation’. The business will invest in the segments of the UK bakery category that are growing as a result of changing consumer tastes and needs, including healthy options.

Gavin Orde, Managing Director at Arrowpoint Advisory, said: “I am delighted to have advised ABF on this high profile bakery transaction which is the 7^th bakery transaction Rothschild & Co has advised on in the last 18 months.  As well as the corporate finance considerations of the deal, there was significant regulatory complexity to navigate following the announcement of the deal and it is great to have reached completion. I look forward to seeing the progress Hovis Bakeries makes in the coming years.”

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