One of New Zealand’s top fine food manufacturing businesses, whose growth has been boosted by strong demand amid Covid disruptions, has been put up for sale.
The business has only had two owners in the last 32 years and now produces hundreds of premium products including sauces, dressings, marinades, stocks, syrups, concentrates and condiments.
Its own-brand foods can be found on the shelves of New World supermarkets, in gift and specialty food stores, in incentive and reward schemes such as Flybuys, and in export markets as far afield as Denmark, the US and Norway.
However, the bulk of the company’s foods are produced under contract for other New Zealand customers and sold under third-party brands.
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Bayleys business broker Matt Clifford said this has positioned the company for a surge in demand as an essential-service food producer.
“Historically, New Zealand food suppliers have tended to have their products produced by manufacturers offshore. With Covid-19 that model has been turned on its head.
“Lockdowns, closed borders, supply-chain shortages and disruptions to freight and logistics have piled on extra costs and delays.
"As a result, many Kiwi food suppliers are switching to local contract manufacturing and packing facilities.
“The business for sale is ideally placed to capitalise on this trend. It can offer clients a complete ‘turn-key’ solution with product development, packaging and the full commercialisation of tailored food-safe products.
“It currently makes more than 120 products for 19 well-respected brands. The operation is growing, and its current owners have made additional investments to ensure it can accommodate further growth,” said Clifford.
The business last year produced more than a million individual food items, amounting to some 300 tonnes of products for distribution in New Zealand and offshore.
It has delivered a cumulative year-on-year sales increase of 21 per cent over the last three years, with current annual revenue of $3 million, and profits forecast to grow.
The operation is now being marketed for sale as a going concern by expressions of interest through Bayleys’ specialist business sales team.
Clifford said the food production facility had been operated for 12 years by the current owners, who had invested heavily in plant and equipment, skilled staff, operations and food safety programmes, as well as new product development.
Bayleys business sales national director Jayson Hayde said business assets covered by the sale included plant and machinery for end-to-end food production, such as cooking vessels, bottling, filling, packaging and labelling equipment and some 90cu m of chilled and frozen storage for incoming and outgoing product.
“The business carries a strong lease with rights of renewal through to 2026 and a landlord open to discussing longer-term continuity,” Hayde said.
The approximately 1100sq m facility includes a process kitchen of over 100sq m, some 685sq m for packing and warehousing, offices over two levels, plus a showroom and shop on the ground floor. The site has 17 off-street carparks for staff and clients.
Hayde said the existing owners had continued to upgrade the facility to accommodate ongoing growth. They recently invested in new assets that would reduce cooking times and further boost production.
“Another key asset for this business is its highly-skilled team, with two experienced directors plus specialists in food technology, quality control, operation and maintenance of equipment, logistics, business development and sales.
“New owners and clients can also rest assured that food safety and site compliance is well in hand, thanks to industry-leading certifications including an annual audit by SGS, the world’s leading inspection and certification body.”
Hayde said the business continued to innovate, with more than 20 new products or variants under development for various brands.
While Covid had focussed and accelerated a trend favouring domestic food manufacturers, the sector also stood to gain from longer-term tailwinds.
“Global demand for food is projected to rise by 50 per cent by 2050, while New Zealand’s own population is set to swell by a million to 6 million in the same period.
“As a heritage Kiwi brand with a well-equipped production facility, proven systems, established relationships, industry goodwill and intellectual property built up over three decades, this business is ideally geared for the future.
“It has a healthy pipeline of forward opportunities and a comprehensive solution to quickly bring new products to market. Its business model and operation are readily scalable to capitalise on future growth,” said Hayde.
Detailed information is available to potential buyers subject to signing a confidentiality agreement.
- Article supplied by Bayleys
