Agricultural and engineering group Carr’s has sold its food division to historic specialist flour milling business Whitworths Holdings in a £36m deal.
The disposal of Carr’s Flour Mills to Wellingborough-headquartered Whitworths Holdings is for a gross consideration of £36m and net consideration of £24.9m.
The move will allow the company to return £16m by way of a special dividend of 17.54p per share. It added the remaining £8.9m provides “balance sheet strength”.
“At a time of increasing competition and volatility in the flour market, consolidation is essential and inevitable,” said Tim Davies, chief executive of Carr’s.
“This acquisition by Whitworths presents a great opportunity for the food division to continue building on the strong foundations laid over many years. On behalf of the Carr’s board, I would like to thank everyone who has contributed to the division’s success.”
Davies added the group would continue to focus on growing its UK agriculture business and developing its international feed supplement division.
Martin George, chairman of Whitworths Holdings, said: “Carr’s Flour Mills Ltd shares a similar history to Whitworths in that it is a long standing business which has received material investment in recent years.
“The business is a great fit geographically and will give us access to the South East, North of England and Scottish markets that would otherwise not be available and means we have national reach.”
Carr’s food division is a supplier of flour to bakeries and food manufacturers across the UK. The division operates from three sites at Silloth in Cumbria, at Kirkcaldy in Fife and at Maldon in Essex.
In the year to 29 August 2015, the division generated revenues of £80.3m and a profit before tax of £2.4m.
By David Casey
Source: Insider Media
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