K-based consumer goods manufacturer PZ Cussons has entered into an agreement to acquire organic baby food producer Rafferty's Garden from Australian private equity firm Anacacia in a £42.2m all-cash deal.This move by PZ Cussons comes after the Australian Competition and Consumer Commission (ACCC) opposed US-based food giant HJ Heinz's proposed acquisition of Rafferty's Garden, in June.
Rafferty's Garden is a leading nutritious baby food brand in Australia with approximately 40% share of the wet baby food market, as well as a growing share in the infant dry and snacks market.
The company is in the early stages of development to begin exports to countries such as Indonesia and Thailand. The manufacturing operations have been outsourced to third parties.
Rafferty's reported revenues of £22.5m for the year ended 30 June 2012, while earnings before interest, taxes, depreciation, and amortization (EBITDA) was £3.5m. As at 30 June 2012, the company had gross assets of £12.5m.
PZ Cussons chief executive officer Alex Kanellis said that the acquisition of Rafferty's Garden marks the company's entry into the food and nutrition category in Asia-Pacific and the addition of another leading brand to its portfolio.
"This leading position together with an exciting pipeline of new products provides the platform for further growth within Australia," Kanellis added.
PZ Cussons stated that its distribution capabilities in countries such as Indonesia and Thailand and its leading Cussons Baby brand will maximize the geographic expansion of Rafferty's Garden.
Rafferty's Garden managing director Michael Tinkler said: "PZ Cussons is a great fit for our business and we are looking forward to working with them to service our existing stakeholders as well as expand the business internationally."
PZ Cussons is a manufacturer of personal healthcare products and consumer goods. The company operates across Europe, Asia-Pacific and Africa with leading brands in personal care, homecare, electrical goods and food and nutrition.
The company's existing business in Australia include well-known brands of Morning Fresh, Radiant, Duo, Imperial Leather, Original Source and St Tropez.
