Devon-based food wholesaler MJ Baker Foodservice Ltd has been bought by a North East firm in a £24.5m deal.
The Newton Abbott company, founded in 1999, has had its entire issued share capital acquired by North Shields-based Kitwave Wholesale Group. It is the first acquisition by Kitwave since it was listed on the Stock Exchange’s Alternative Investment Market (AIM) in 2021.
MJ Baker, the West Country’s leading independent foodservice supplier offers more than 3,500 products in ambient, chilled and frozen foods, together with alcohol, confectionery and non-food items. The leading brands are complemented by a range of products under the Bakers Best Buy lines.
Kitwave said MJ Baker had net assets of £7.9m and it was acquiring about £6m in cash and £1m of property in the deal. It said the acquisition would be immediately earnings enhancing, with the MJ Baker business joining previous Kitwave acquisitions in its food service division.
MJ Baker’s most recent accounts, for 2020, showed turnover of £16.8m - down from a pre-pandemic £28.2m - and a pre-tax profit of £1.5m, also down on 2019’s £2.7m. The annual report said 2020 had been a “very difficult year” and that it was severely impacted by the affects of Covid-19 because most of its customers were in the hospitality sector and had closed for much of the year.
MJ Baker will now be incorporated into Kitwave’s existing foodservice division which currently has the existing trading operations of HB Clark & Co (Successors) Ltd and David Miller Frozen Foods Ltd.
Paul Young, chief executive of Kitwave, said: “The acquisition of MJ Baker is an excellent addition to our foodservice division and expands the group’s nationwide reach into the South West. MJ Baker is renowned for providing a quality delivered solution to its customers, a key part of the Kitwave Group ethos.
“I am delighted to welcome the MJ Baker team to Kitwave and we look forward to continuing to build our nationwide foodservice offering as part of our growth strategy.”
Kitwave was formed in 1987 after the acquisition of a single wholesaler in North Shields specialising in confectionery. Through a series of acquisitions, it now has more than 1,000 employees and a network of wholesale depots around the country that supply a wide range of food, alcohol and tobacco to about 38,000 shop owners.
David Brind, chief financial officer of Kitwave, said: “This acquisition significantly adds to Kitwave’s Foodservice division and extends the reach of our services into an important region of the UK. The integration of MJ Baker into the group’s foodservice division complements our existing operations and reflects Kitwave’s strategic direction and expansion ambitions, both through acquisition and organic growth.”
