Langholm Capital, a UK consumer mid-market buyout firm, has bought Tyrrells Potato Chips, a UK crisp company. Terms were undisclosed, but a City source said Langholm had paid more than £30 million ($59.2 million; €37.5 million).
The business’ founder Will Chase has retained a significant stake in the business. Chase has farmed potatoes in Herefordshire for the last twenty years and started making premium chips in 2002, using his home-grown potatoes.
The business has grown to a turnover of £13 million in the year to March 2008. The company’s products are distributed across the UK and abroad in farm shops, delicatessens, and other upmarket outlets. Tyrrells uses more risqué potato varieties like Lady Rosetta to appeal to the growing demand in the UK for more exotic crisps, according to a spokeswoman. The company has also developed parsnip, carrot and beetroot chips as well as flavours such as asparagus and crushed black pepper, and Ludlow sausage with wholegrain mustard.
The spokeswoman said: “It’s a great brand, that’s been doing well, and Langholm wants to take the business further by increasing production and then distribution.”
Upmarket crisps have been popular with private equity firms, and buyouts include Lion Capital’s acquisition of Kettle Foods, a US maker of premium crisps and snacks, in 2006 for between $280 million (€218 million) and $320 million. Other outfits have tapped into the UK demand for lifestyle food goods, such as Phoenix Equity Partners, which acquired organic box company Abel & Cole last year.
Langholm’s previous investments include Dorset Cereals, which under Langholm’s ownership became the second most popular muesli brand in the UK, as well as the fastest-growing mainstream breakfast cereal company overall in 2007, the spokeswoman said. Although no financial details were disclosed, Langholm made a four times return from the sale of Dorset Cereals in three years, according to a source close the deal.
Set up in 2002, Langholm is investing its first fund of almost €250 million ($395 million), which was raised with the backing of consumer giant Unilever, and the specialist food and consumer goods bank, Rabobank International.