Premier Foods, the owner of brands such as Mr Kipling and Bisto, has agreed a deal worth £48m to acquire Merchant Gourmet, a maker of healthy ready-to-eat pulses and grains, microwaveable rice, and meals.
The transaction will see Premier Foods purchase 100% of shares in Merchant Gourmet on a cash and debt-free basis, with the deal expected to be completed at the beginning of next month.
Merchant Gourmet is on track to generate revenues of around £28m in its current financial period to 28th March 2026, with double-digit growth over the last two years. The company, which supplies its products through third-party manufacturing arrangements, has listings in leading grocery retailers, including Tesco, Sainsbury’s, Morrisons, and Waitrose.
Premier Foods stated that the business was “highly complementary” to its portfolio and aligned with its acquisition strategy, amid a shift in consumer preferences towards healthier, more natural food.
The company acquired protein brand FUEL10K for £34m in October 2023 and Asian food brand The Spice Tailor for £43.8m in July 2022.
Premier Foods noted that it will “unlock significant value” in the Merchant Gourmet range through leveraging its “proven branded growth model”.
Alex Whitehouse, the manufacturer’s Chief Executive, commented: “We’re very pleased to have agreed the acquisition of Merchant Gourmet, which meets the growing demand for premium, healthy and convenient meal options.
“Replicating the success of our previous two acquisitions, The Spice Tailor and FUEL10K, we will be deploying our proven branded growth model; expanding retailer distribution, accelerating new product development, and increasing marketing investment to unlock further profitable growth for the brand. Merchant Gourmet expands our category presence, complementing our already strong brand portfolio, and we look forward to welcoming the team to Premier Foods.”
Richard Peake, Managing Director of Merchant Gourmet, added: “Merchant Gourmet has always been about creating great-tasting, premium, healthy food that anyone can enjoy. Over the last few years, our team have worked incredibly hard, delivering double-digit revenue growth and demonstrating huge success in entering new categories and new markets.
“Finding the best home for both Merchant Gourmet and our valued team is something we have thought carefully about, and we believe Premier Foods is the right partner to match our ambition. They understand where we’ve come from, they respect what makes our brand special, and we’re excited to continue innovating boldly and inspiring people to fall in love with simple, good food.”