Fresh produce wholesaler WestCountry Food has been acquired by wholesale business Kitwave Group in a deal valued at £29 million.
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The deal value represents around a 7.4x multiple of WestCountry’s £3.9 million pre-tax profits for the year ending January 1 2022, generated on revenue of £29.7 million.
WestCountry is based in Falmouth and provides local, regional and imported fresh produce to the south-west of England’s foodservice sector. The company, which has depots in Newton Abbot and St Austell, has developed a strong network comprising local growers of fresh seasonal produce and direct supply connections with national and international fresh produce suppliers.
Kitwave, an AIM-listed business that supplies over 38,000 shop owners, said that it believed the acquisition would be immediately earnings enhancing, as well as helping it move into fresh food provision. Post-acquisition, WestCountry will be incorporated into Kitwave’s existing foodservice division, which is home to several firms, including David Miller Frozen Foods and M J Baker Foodservice.
Paul Young, CEO of Kitwave, commented: “The acquisition of WestCountry enables us to expand our product range to include high-quality fresh produce and complements our existing foodservice offering in the south west, following the acquisition of M J Baker earlier in 2022.”
“We are delighted to welcome the WestCountry team to Kitwave and look forward to successfully integrating the business into the group’s foodservice division and further extending our nationwide reach.”
Kitwave recently announced that it had performed strongly in the second half of the year and said its next results were set to meet upgraded expectations. Paul Young added: “The group continues to trade well and despite wider macroeconomic pressures, the directors believe the outlook remains positive. We look forward to updating shareholders further on our progress.” ■
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