Tomkins sells RHM for £1.1bn

Tomkins has sold its Ranks Hovis McDougall food arm to venture capital firm Doughty Hanson for £1.1bn after a year of talks.

LONDON (Brand Republic) – Tomkins has sold its Ranks Hovis McDougall food arm to venture capital firm Doughty Hanson for £1.1bn after a year of talks.

The company says it wants to concentrate on its engineering and construction businesses in the US.

RHM, which manufactures Cadbury and Mr Kipling cakes, Hovis bread and McDougalls flour, will be primed for a stock market flotation within three to five years, according to new owner Nigel Doughty. He wants to relaunch it as a leading European food company, snapping up others on the way.

“It is a high-quality, successful business, and we will build on its stable of long-established brands with market-leading positions by growing the business organically and making acquisitions to expand in Europe,” he said.

He said there were no plans to cull any RHM brands: “It is business as usual.”

A spokeswoman said jobs would be unaffected at operational and managerial level.

Tomkins’ chief executive Greg Hutchings relinquished his role as executive chairman three weeks ago and is replaced by former General Electric Company finance director David Newlands.

RHM was bought by Tomkins in 1992 with yearly sales of £93m. Last year sales reached £1.6bn. Its British Bakeries arm has a 32% share of the UK bread market, while a number of plants make prepared meals for most of the country’s supermarket chains.

The deal is the latest in a spate of consolidations within the US and European food sector. Diageo sold its Pillsbury food arm to General Mills last week, Unilever bought Bestfoods in June, and Philip Morris has taken over Nabisco.



You have

[DAYS_LEFT] Days left

of your free trial

Subscribe now

Become a member of Campaign from just £46 a quarter

Get the very latest news and insight from Campaign with unrestricted access to campaignlive.co.uk ,plus get exclusive discounts to Campaign events

Become a member

Looking for a new job?

Get the latest creative jobs in advertising, media, marketing and digital delivered directly to your inbox each day.

Create an Alert Now
Share

1 Why creative people have lost their way

What better way to kick off Campaign's relaunch than with another think piece on the current failings of our industry, written by an embittered, pretentious creative who misses "the way things used to be"...

Share

1 Job description: Digital marketing executive

Digital marketing executives oversee the online marketing strategy for their organisation. They plan and execute digital (including email) marketing campaigns and design, maintain and supply content for the organisation's website(s).