Baring exits Weetabix in £1.4bn trade sale to Post Holdings

Kenny Wastell
19 April 2017

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Baring Private Equity Asia is to divest its 40% stake in UK cereal business Weetabix in a ТЃ1.4bn sale to US trade buyer Post Holdings.

Baring and Chinese state-owned Bright Food Group, which bought a 60% stake in the company from Lion Capital in May 2012, will work alongside Post in a joint venture to manage Weetabix's Chinese operations.

The deal comes a year and a half after Baring acquired the minority stake in the company from Lion.

As part of the deal, Weetabix's existing director of marketing, Sally Abbott, will take on the role of managing director for the UK and Ireland. Current CEO Giles Turrell will be appointed chairperson of Weetabix.

The trade buyer is expected to fund the acquisition via a mixture of cash on hand and the group's existing revolving credit facility. The business will also explore the possibility of taking out a senior loan, subject to market conditions.

The sale of Weetabix to Post is expected to complete in Q3 2017.

Previous funding
Lion took Weetabix private in a £642m deal in 2004. The GP then divested a 60% stake in the company to Bright Food in May 2012, in a deal valuing the business at £1.2bn.

Three years later, Baring acquired the remaining 40% stake in Weetabix, to become joint shareholder with Bright Food. The full exit generated a return of around 5x for Lion, according to an unquote" report at the time.

Company
Founded in 1932, Weetabix is a Kettering-based breakfast cereal producer with brands that include Alpen, Weetabix, Weetos and Ready Brek. It exports its products to more than 90 countries worldwide.

According to a statement issued by the acquirer, Weetabix is expected to contribute £120m of adjusted EBITDA to Post. The business generated a turnover of £346.4m in 2015, according to publicly available documents, of which £290m was accounted for by UK sales. It has a headcount of around 950.

People
Baring Private Equity Asia – Jean Eric Salata (founding partner, CEO).
Weetabix – Giles Turrell (chairperson).