Boots sells Farley's baby foods: Deal with Heinz helps company's core products strategy

Click to follow
The Independent Online
BOOTS has agreed to sell its Farley's baby food and adult nutrition businesses to H J Heinz for pounds 94m. The sale is intended to allow Boots Healthcare International, the consumer healthcare products arm, to concentrate on its core over-the-counter medicines.

The disposal follows smaller sales of brands outside the product categories Boots wants to develop - cough and cold remedies, pain relief, eye care and skin care.

It has recently made acquisitions in France and Italy complementing these areas. Mike Gates, a company spokesman, said Boots intended to develop the four core categories into pan-European businesses.

Boots will have no nutrition businesses left after the sale. It said it did not expect to make further healthcare disposals.

It launched a review of its prescription drugs division after the withdrawal last July of Manoplax, a heart drug, dealt a serious blow to its ambitions in pharmaceuticals. Mr Gates said a full or partial disposal of the pharmaceuticals arm was still under consideration.

Products being taken over by Heinz, including Farley's rusks, Timers baby cereals and Crunch 'n' Slim diet foods, had sales of pounds 53m in the year to 31 March, 70 per cent in Britain. Net assets of pounds 21m are included in the sale.

Heinz made the initial approach. Andrew Barrett, UK managing director, said the acquisition would help Heinz towards its goal of being a leading European baby food manufacturer.

Boots will publish the profits of the businesses and the balance sheet effects of the sale with its annual results on Thursday. The shares fell 15p to 509p.

(Photograph omitted)