Intersnack will merge UK business with KP Snacks in 2014

By Kacey Culliney

- Last updated on GMT

Intersnack's majority stake in Largo Foods (Tayto owner) has prompted competition investigation in Ireland
Intersnack's majority stake in Largo Foods (Tayto owner) has prompted competition investigation in Ireland

Related tags: Kp snacks, Mergers and acquisitions

European Intersnack Group will merge its UK business with KP Snacks in 2014, a spokesperson says.

The Pom-Bear maker bought KP Snacks from United Biscuits in December last year​ in a deal rumored to be close to $600m.

Speaking exclusively to BakeryandSnacks.com, a spokesperson for Intersnack said: “We are currently working on plans to merge Intersnack UK and KP Snacks UK – this should happen in 2014.”

“The merged company will most probably come under ‘KP Snacks UK’.”

Intersnack’s UK unit is relatively small compared to its wider European operations - representing about 6% of overall business - and it is far smaller than KP Snacks; prompting the decision to form the merger under the latter.

The KP Snacks takeover strengthens its position in the UK snacks market, boosting its share up to 14% and set to bring in an additional €330m ($431m) to the business.

The spokesperson said that for the time being, Intersnack plans to keep its newly acquired UK snacks business separate from its European operations but under a joint management team.

UK deal clearance, Irish investigation

The UK part of the deal was cleared at the end of January this year, but the takeover of KP Snacks Ireland – that represents around 1% of the business – remains under review by local authorities.

The Competition Authority in Ireland has taken its investigation of the acquisition into ‘phase two’ as it was “unable to conclude that the acquisition will not substantially lessen competition” ​after a preliminary phase. The final decision will be made by, or before, May 29.

Intersnack’s spokesperson said the company is fully cooperative with the Irish authorities and confident clearance will be given.

The reason behind a more thorough investigation by the competition authority in Ireland is because of Intersnack’s majority stake in Largo Foods – the owner of the Tayto potato chip brand, he said.

“In the UK there was really no issue, but in Ireland we do already have significant business there.”

UK the focus for Intersnack

Internsnack’s strategy to drive KP Snacks forward will be focused on UK operations more than Ireland.

“KP Snacks Ireland is with a distributor, so it’s a very little operation. The brands do have a certain position in Ireland, but our main focus is on the UK.”

Intersnack’s director of marketing for Europe Bernd ter Glane told this site​ back in December that the focus would be on three ‘star’ brands – McCoy’s, Hula Hoops and KP Nuts.

Related topics: Manufacturers

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