Premier Foods has broadened its breakfast segment with the acquisition of protein-enriched breakfast brand FUEL10K. The deal, worth a cash and debt-free price of £34 million, was finalized on Sunday (29)and is expected to enhance Premier Foods' earnings in the first full year following the acquisition.
The purchase involved an upfront payment of £29.6 million from cash reserves, a minimum deferred payment of £4 million due in 2026-27, and additional payments tied to FUEL10K's sales growth until FY2025-26. The latter are capped at £55 million in total, stated latest reports.
This strategic move follows the successful launch of Ambrosia porridge pots by Premier Foods and comes on the heels of its successful integration of The Spice Tailor, which led to a significant revenue boost. FUEL10K, known for its strong double-digit revenue growth over the past three years, reported a pre-tax profit of £0.5 million in the last fiscal year.
Premier Foods chief executive Alex Whitehouse said, "The acquisition of FUEL10K follows on from our successful integration of The Spice Tailor, where we have increased revenue and profit through the application of our branded growth model.
"FUEL10K provides us with an ideal platform to accelerate our expansion into the Breakfast category, building on our recent successful launch of Ambrosia porridge pots. Possessing a differentiated category position, with its protein enriched product range and appealing to a younger demographic, we expect to deliver significant further profitable growth of FUEL10K through the deployment of our successful branded growth model."
Barney Mauleverer, co-founder of FUEL10K, expressed optimism about the brand's future trajectory under Premier Foods' stewardship. He said he views Premier Foods as the ideal custodian for their brand and is confident about its potential for continued success, reports stated.
