Duke Street goes for a Burton’s

UK buyout firm Duke Street Capital has sealed its latest acquisition in the food sector, buying UK snack-maker Burton’s Foods in a deal thought to be worth more than £200 million.

UK mid-market buyout firm Duke Street Capital has won the auction for Burton’s Foods, a UK-based snack maker previously owned by HM Capital.

Financial details were not disclosed, but sources said Duke Street paid more than £200 million (€293 million; $389 million) for the business, which attracted interest from both private equity firms and trade buyers. Northern Foods and Irish investment group Lioncourt Capital were just two of the groups involved in the bidding.

Some of Burton’s top brands

Burton’s makes some of the UK’s best-known biscuit brands, including Jammie Dodgers and Wagon Wheels, and also manufactures snacks under licence for companies like UK chocolate maker Cadbury and Anglo-Dutch conglomerate Unilever. In addition to its core UK market, it also exports to Scandinavia, the US and France. The company had revenues of about £300 million last year.

Duke Street said it plans to continue growing the company organically and through further acquisitions. Burton’s is looking to expand its product range away from sweets and biscuits into savoury snacks and other more healthy products.

It is a case of second time lucky for Duke Street, which narrowly lost out the last time Burton’s was on the auction block, in 2000. US-based HM Capital, the former Hicks Muse Tate & Furst, won the auction, paying £130 million to buy the business from Associated British Foods. It has since merged the business with Horizon, another biscuit maker.

This is not Duke Street’s first acquisition in the food sector, though its previous deals have all been in the chilled ready-to-eat area. It formed Adelie Food Holdings, a UK-based supplier of chilled foods like sandwiches and quiches, by bringing together Buckingham Foods and Thomas Food Group in March 2006, and then adding Food Partners in April 2006 and Superior Food Group in February 2007.

Biscuits have also been popular with other buyout firms: last year The Blackstone Group and PAI Partners paid £1.6 billion to buy United Biscuits from Premier Foods.