Post Holdings, the Missouri-based consumer goods company behind brands such as Shredded Wheat and Bran Flakes, on Monday completed its long-awaited takeover of Weetabix, giving it full control of one of the world’s most popular breakfast foods.
The company paid $1.7bn (£1.3bn) to buy the brand from China-based Bright Food and private-equity firm Baring Private Equity Asia. In April, when the deal was first announced, Post said the acquisition would help it gain a foothold in the UK market.
“We have long admired Weetabix as a leader in cereal and believe it will be a fantastic strategic fit within Post,” Rob Vitale, Post’s president and chief executive, said at the time. “Combining together two category leaders continues our strategy of strengthening our portfolio in stable categories and diversifying into new markets, bringing much-loved brands to significantly more customers globally.”
Northamptonshire-headquartered Weetabix, which also makes Alpen cereal, Weetos and Oatibix, dates back to 1932 and was family owned until 2003.
In 2012, Shanghai-headquartered Bright Foods bought a majority stake in the brand, but in December last year the owners reportedly hired banks to lead a sales process.
Analysts say that Bright Foods had hoped that Weetabix would help it crack the lucrative Asian market, but while China now represents Weetabix’s third-largest market, most of its sales still come from its much slower-growth home market.
Before the takeover, Weetabix already had operations in North America, South Africa, Germany and Spain, and it is the majority owner of a joint venture in Kenya that serves the African market.
Barclays, Rabobank, Credit Suisse and Nomura acted as financial advisors to Post. The deal was funded with cash on hand as well as a term loan.
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