Bright Food in talks to acquire Weetabix

Chinese food company Bright Foods is reportedly in talks with Lion Capital over the acqusition of British breakfast cereal company Weetabix in a deal valued at £1bn.

The negotiations began soon after Lion Capital refinanced Weetabix’ £900m in late 2011, however it is not clear how advanced the talks are at this stage.

Bright Food, one of China’s leading food companies with an annual turnover exceeding £4bn, experienced a series of failed deals in the past.

In 2010, the company failed to strike a £2bn deal to acquire United Biscuits, the UK manufacturer of Jaffa Cakes and Hula Hoops. In the same year, it made an unsuccessful attempt to buy Sucrogen, the sugar and biofuels division of Australia’s CSR.

In 2011, it was outbid by General Mills over the acquisition of the majority stake in French yogurt brand Yoplait.

In August 2011, the company however successfully acquired a 75% stake in Australian food company Manassen Foods for $556m.

Weetabix was bought by Lion Capital in 2003 for £642m and is the second largest manufacturer of breakfast cereals and cereal bars in the UK, holding a 7% share of the country’s total cereals market.

Headquartered in Kettering, UK, the company has presence in around 80 countries around the world including North America, South Africa, Germany and Spain and owns other brands such as Alpen, Ready Brek and Oatibix.

In 2010, the company reported revenues of £449m and pre-tax profit of £20.4m.