Confectionary importer and wholesaler Innovative Bites has bought confectionary wholesaler Hancocks, in a deal reportedly worth close to £100m.
It is the second major purchase for Innovative Bites who acquired Bonds of London last April. Innovative Bites, which owns the distribution rights to brands including Twinkies, Warheads and Trolli, now has a combined group portfolio of 7,000 confectionary products.
Vishal Madhu, Founder and Owner of Innovative Bites, told Asian Trader that the recent acquisition from H2 Equity Partners is helping to evolve the business into a confectionary distribution powerhouse.
“This acquisition puts Innovative Bites at the forefront of confectionary distribution in the UK,” says Madhu. “We now have an omni-channel business with unparalleled route to market and trade with all major confectionary brands, niche brands and our own label.”
The growing company now employs more than 500 employees in more than 25 sites across the UK.
The Hancocks purchase comes a few months after Tesco’s proposed merger with wholesaler Booker. Does Madhu think purchasing wholesalers is the way of the future?
“It’s definitely a strategy that’s becoming more popular but not necessarily one that I wholly support,” said Madhu. “I can see what Tesco are trying to do and indeed it worked for Walmart in the US, but I think the benefits to the retailer far outweigh the benefits to the wholesaler – particularly in this case, as Bookers supplies mainly independent businesses.”
However, Madhu believes that increased consolidation in the grocery market is not necessarily a bad development.
“Consolidation in the grocery market to bring bigger and better businesses is a very sound and positive strategy,” said Madhu. “Not only does it provide independent retailers with a huge range of choice, but it also reinforces their ability to maintain their stock levels, further enhancing their offer to their customers. I don’t see a lot of negatives in consolidation – it is good for everyone.”
Madhu says there will be no staff changes in the near future and it is business at usual at Innovative Bites.