Real Good Food PLC Acquisition of Rainbow Dust Colours Ltd (5704C)
20 Janvier 2015 - 8:00AM
UK Regulatory
TIDMRGD
RNS Number : 5704C
Real Good Food PLC
20 January 2015
Real Good Food plc (AIM: RGD)
Real Good Food plc acquires Rainbow Dust Colours Ltd for an
initial GBP4 million
Real Good Food plc is a diversified food business, serving a
number of market sectors including retail, manufacturing,
wholesale, foodservice and export. The Group is a major distributor
of sugar in the UK through its Napier Brown subsidiary, and
manufactures a wide range of baking ingredients, jams and sweet
bakery products. Its brands include Whitworths Sugar, Renshaw and
R&W Scott.
Real Good Food plc ("RGF") is delighted to announce that it has
completed the acquisition of Rainbow Dust Colours Ltd. ("Rainbow
Dust"), a specialist supplier of cake decorating products to the
sugarcraft industry, including coloured edible glitters, dusts,
sprinkles and food paints.
RGF is paying an initial GBP4 million, with an additional cash
consideration of up to GBP3.5m in the form of an earn-out based on
gross margin achieved in the 12 months following completion of the
acquisition. The initial consideration has been satisfied in cash,
funded by a new banking facility with Lloyds Bank Plc.
The two founder directors of Rainbow Dust, Gary Brown and Carol
Brown, will be joining RGF and will continue to run it as a
standalone business within the RGF portfolio.
Rainbow Dust employs 28 people and operates out of a
manufacturing site near Preston in Lancashire. For the 12 months to
31 July 2014 Rainbow Dust reported turnover of GBP3.3 million and
achieved a trading profit before tax of GBP1.7m. As at 31 July
2014, it had gross assets of GBP4.9m.
There are considerable synergies between Rainbow Dust and RGF's
successful baking ingredients business, Renshaw, and the
acquisition is expected to bring mutual benefits to the two
businesses, particularly in developing new products, driving growth
in exports and opening up new sales channels.
RGF is delighted that the existing management team has agreed to
stay with the business to maintain continuity and work with RGF to
realise growth opportunities. RGF envisages no effect on jobs at
Rainbow Dust, although the headcount may increase in line with
growth plans.
Pieter Totté, Executive Chairman, comments:
"The increasing popularity of cake decoration has become a
global phenomenon. We are excited by the growth prospects which
this market offers and we will look to build on the knowledge and
expertise which both Renshaw and Rainbow Dust possess to become a
world leader in the sector. This acquisition is the first of a
number of initiatives designed to refocus our corporate strategy
and deliver increased shareholder value."
20 January 2015
ENQUIRIES:
Real Good Food
Pieter Totté, Chairman Tel: 020 3056 1516
Andrew Brown, Marketing Director Tel: 020 3056 1516
Mike McDonough, Finance Director Tel: 0151 706 8200
Shore Capital & Corporate Tel: 020 7408 4090
(Nomad and Joint Broker)
Stephane Auton
Patrick Castle
Daniel Stewart and Company Plc Tel: 020 7776 6550
(Joint Broker)
Martin Lampshire
Cubitt Consulting Tel: 020 7367 5100
Gareth David
This information is provided by RNS
The company news service from the London Stock Exchange
END
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