Finsbury acquires gluten-free bakery firms

By Charlotte Eyre

- Last updated on GMT

Related tags: Finsbury, Nutrition

Finsbury has strengthened its position in the UK gluten-free bakery
market with the acquisition of two manufacturers in the country -
Yorkshire Farm Bakery (YFB) and A&P Foods.

The announcement demonstrates a common trend among bakery firms of moving into the market for healthier foods, as companies can no longer rely on traditional products - seen as being full of unhealthy fat and sugar - to maintain profits. Dave Brooks, Finsbury chief executive, told BakeryAndSnacks.com that the company decided to make the acquisitions as 'free from' products are becoming an increasingly important component of Finsbury's portfolio. "TheUKretail market offers huge scope for growth as more and more consumers choose a wheat free diet,"​ he said in a statement. "These businesses perfectly fit our acquisition criteria, and their acquisition is further evidence of our group's confidence in our market positioning." ​Gluten-free bread is popular with many consumers in developed nations, especially amongst those suffering from intolerance to gluten, also known as coeliac disease. According to Mintel, the disease currently affects an average of one in 300 people in Europe and the US.​ Mintel also estimates that the value of the UK free-from market was £180m (€227.713m) in 2007, a figure expected to double by 2012. Through the new deal, Finsbury will acquire the trade and assets of YFB, which manufactures gluten-free bread in Hull, and A&P, which produces gluten-free premixes for bakery products on the same site. The company claims that once the acquisitions are completed, Finsbury will be one of the leading manufacturers of gluten-free products in the UK, with around 20 per cent of the country's market share. According to Brooks, the new business will generate around £700,000 in revenue after tax every year. He also said Finsbury will look to develop a stronger export business of these products in Europe and Australasia. Finsbury first expressed its interest in the 'healthy' bakery market in 2006, when the company pledged to remove hydrogenated fats from its products, and to cut back on artificial flavourings and colourants. The company also pledged to develop goods for the organic sector and produce a greater range of low-fat cakes. This healthy drive appears to have paid off for Finsbury, which is now one of the most prominent finished-products bakery companies in the UK. Last month, the firm said that net sales increased by a massive 91 per cent to £82.78m (€104.7m) Operating profit for the same period went up 150 per cent to £4.5m (€5.7m), the company said. According to Finsbury, combined YFB and A&P sales in the year ended March 2007 were £7.3m (€9.2m), with forecast sales for the year to March 2008 of £8.5m. The total cost of the deal will be £8.9m (€10.8m), Finsbury added.

Related topics: Markets, Gluten-free & Allergens

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