pounds 120m for Cheese Company

NIGEL COPE

The Cheese Company, which manufacturers a fifth of the country's Cheddar, has been sold to Waterford Foods of Ireland for pounds 128m. Its four directors and 70 of the staff who took part in the management buyout from Grand Metropolitan three years ago own 20 per cent of the equity and stand to make considerable gains.

The Cheese Company is one of the UK's two largest cheese producers. In addition to Cheddar, it also manufactures Stilton and other dairy products such as yoghurts and fromage frais.

The deal represents a significant move for Waterford into the UK dairy market.

Matt Walsh, managing director, said: "It will give us additional access to the important British retail, industrial and catering sectors and enhances our product development and marketing expertise."

The Cheese Company's senior management will stay with the company, with Roger Davenport, managing director, set to join Waterford's board. John Madden, operations director, will oversee the integration of the two businesses.

Last year the Cheese Company achieved profits of pounds 12m on sales of pounds 291m. Operating profits for the nine months to July this year were up to pounds 12.7m. It has no debts, but after the acquisition Waterford's gearing will rise to more than 100 per cent on borrowing of almost pounds 200m. The Cheese Company operates from five factories in the UK.