As flagged earlier this month, Typhoo Tea fell into administration yesterday after a period of falling sales, widening losses, and rising debt.
Insolvency specialists at Kroll have been appointed to oversee the administration process and are hoping to strike a rescue deal for the 121-year-old business with Supreme, a Manchester-based firm that owns brands such as SCI-MX and 88Vape.
Supreme said rescue talks were at “an advanced stage”, but it was not certain that an acquisition deal would be completed. The company, which also distributes batteries for the likes of Duracell and Energizer, has recently been growing its drinks and nutrition operations to reduce its focus on vaping before a government clampdown due next year. In June, Supreme acquired Acorn Topco, the parent company of Clearly, a manufacturer of spring water-based drinks.
Typhoo has been trying to turn itself around since being taken over by investment firm Zetland Capital Partners in 2021. The firm has suffered from sluggish sales in recent years as consumers switched from traditional tea to herbal varieties and coffee.
In the year ended 30 September 2023, the tea-makers pre-tax losses increased from £8.5m to £38.0m on revenue down from £33.7m to £25.3m. It attributed the poor results to exceptional costs, which were partly related to one-off expenses from a transformation plan aimed at tackling “significant legacy and structural issues”. Typhoo also suffered a setback last year when trespassers caused extensive damage to its former factory in Moreton, Merseyside.
A spokesperson for Kroll said: “As reported recently, the company has experienced significant cashflow constraints as a result of supply chain disruptions and subsequent service issues.
“The company has been exploring a sale of the business and assets which is in the process of concluding.
“The administration process provides Typhoo Tea with protection, allowing the joint administrators to finalise the sale in order to rescue the business.”
NAM Implications:
- An unfortunate final stage for an iconic brand…
- Those interested in the back story can find details here.
- A final period of uncertainty for staff and customers.
- Fingers crossed…
