UK – International multi-protein food business Hilton Food Group has acquired UK meat supplier Fairfax Meadow Europe from Argent Holdings for £23.8m (about US$32.48m).
Fairfax Meadow operates four meat processing and packing facilities across the UK from whence it supplies some of the largest businesses in the UK hospitality and travel sectors.
Hilton says the acquisition, made through its Hilton Foods subsidiary, would improve its access to the out-of-home channel.
The company further noted that Fairfax Meadow will also help it in harnessing existing partnerships and contributing to further sustainable growth for the business.
Hilton chief executive officer Philip Heffer said: “This transaction is all about growth. With its award-winning reputation, Fairfax Meadow represents a great opportunity for Hilton to expand into an adjacent and growing foodservice sector in the UK.”
“It is another step towards our goal of becoming the protein partner of choice for every meal occasion – offering high quality, affordable, and rigorously sourced proteins for customers and consumers here in the UK and across the world.”
Fairfax Meadows’ acquisition comes just as the company is recovering from the effects of the pandemic where it sustained losses amounting to £2.3m (US$3.14m) in earnings before interest, taxes, depreciation and amortisation (EBITDA).
Panmure Gordon analyst Matthew Webb said Fairfax Meadow’s 2020 EBITDA loss was unsurprising, given the closure of large parts of the foodservice channel for most the the year due to the pandemic. ‘Robust recovery’
“However, what is relevant to HFG [Hilton Food Group] is how Fairfax performs in 2022 and it is already ‘recovering strongly’,” said Webb.
Incorporation of Fairfax Meadows into HFG will give it access to its parent company’s broader range of proteins, including vegetarian and vegan food, fish and sous vide, allowing it to expand its product offering.
Webb notes that on the profitability side, “HFG will undoubtedly have better buying power and sourcing expertise and should therefore be able to reduce input costs.”
Following the acquisition, Fairfax Meadow managing director Penny Tomlinson will remain at the company and continue to lead the business for the foreseeable future.
“Fairfax Meadow is built on a foundation of longstanding, strong, customer and supplier relationships which we will continue to develop as we move forward together,” Tomlinson said.
“Philip and the team at Hilton have followed our progress closely over the past few years and by joining forces now, we will have the right platform and investment for the next phase of Fairfax Meadow’s growth. Butchery and foodservice.”
Earlier, Hilton Food Group announced a trade update on its business, claiming strong performance, and growth in its slow cooked business in the UK and Central Europe.
The company noted that there had been continued volume growth in fresh food across both Tesco and Zabka and progress in expanding the business across a wider range of protein categories.
It further noted that its trading subsidiary Hilton Food Solutions had also performed well, due to the re-opening of foodservice and successful trading with European customers.
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