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A bakery firm that supplies Britain’s supermarket giants has agreed to be taken private in a deal worth £143.4 million.
Finsbury Food Group is set to be bought by Isle of Man-based asset management company DBAY Advisors, with investors in the baking firm getting 110p in cash for each share.
Shares in Finsbury Food Group soared more than 23% in Wednesday morning trading after the deal was announced.
Finsbury Food makes cakes and bread bakery goods, supplying a raft of big names across both the grocery retail market and the “out-of-home eating” food service sector in the UK and Europe.
Its acquirer, Frisbee Bidco, is owned by DBAY, which has offices in Douglas and London and has held shares in Finsbury since August last year.
DBAY said it believes Finsbury’s “public listing and the current turbulence in quoted equity markets substantially inhibit its ability” to pursue growth opportunities, such as acquisitions, to boost its scale and reach.
I am confident that Finsbury will thrive under DBAY’s stewardship in the private market
Peter Baker, Finsbury Food Group
Finsbury chairman Peter Baker said: “For the next phase of the Finsbury Group’s development, the business will need to pursue strategic, transformational mergers and acquisitions (M&A) to achieve the scale required to be successful in an increasingly competitive and demanding market place.
“I am confident that Finsbury will thrive under DBAY’s stewardship in the private market, with access to DBAY’s investment and operational support to pursue the current strategy of scaling Finsbury’s buy-and-build M&A in the future.”
DBAY chief executive Alexander Paiusco said: “We have been supportive shareholders of the business for over a year and have been impressed with the management team during our ownership, but we strongly believe Finsbury would benefit from transformational M&A, including international expansion, and this would be better achieved in private ownership without the barrier of the current listing.”
Finsbury’s directors intend to unanimously recommend the offer to shareholders ahead of a general meeting to vote on the deal, which, if passed, is expected to complete in the final three months of 2023.
As part of the deal and instead of receiving cash per share, shareholders in Finsbury are also being offered the alternative of non-voting B ordinary shares in the bidding company for each share held.
Finsbury’s headquarter is in Cardiff and it has offices and manufacturing sites in Manchester, Salisbury, Sheffield, Pontypool, Scotland, Poland and France, where it has an 85% equity stake in a French business that supplies and distributes bakery products throughout Europe.