Re:Capital acquires Betta Foods, forms Confectionery Innovation Group
International investment company Re:Capital has announced the acquisition of Australian confectionery manufacturer Betta Foods and the formation of a new holding company, The Confectionery Innovation Group Pty Ltd (Confectionery Innovation Group).
The Confectionery Innovation Group will take 100 per cent ownership of Betta Foods, the Broadmeadows-based manufacturer of confectionery items such as marshmallows and snowballs which currently employs 150 staff. Established in 1954, Betta Foods produces liquorice and marshmallow products under the Capricorn and Eskimo brands. The company also produces private label liquorice, marshmallow and ice cream cone products for Australia’s largest supermarkets and fast food groups. Betta Foods has an annual turnover of $30 million.
The transaction represents Re:Capital’s third investment in Australia, following its acquisition of Ernest Hillier Chocolates Pty Ltd (Hillier’s Chocolates) in February 2014.
Founded by Ernest Hillier in Sydney in 1914, Hillier’s remains one of Australia’s most prestigious chocolate makers. The company today still shares Ernest Hillier’s original vision “to offer our patrons only the highest grade confectionery”. Hillier’s chocolates still continue to be made locally in its Melbourne factory, using only the finest ingredients and the same traditional chocolate making processes.
Re:Capital is multidimensional financial services business investing its own capital in stressed and distressed situations across the globe. Re:Capital opened its first Australian office in Sydney 2013.
With over 100 transactions in the last ten years, Re:Capital’s parent, Hilco Capital, is the leading operator in the retail restructuring sector in the UK and has a number of subsidiary companies throughout Europe and in Canada.
In recent years Re:Capital has developed significant capabilities in the distressed manufacturing, wholesale and distribution sectors with many recent transactions coming from outside the retail sector. With first line access up to $250 million of investment capital, Re:Capital is one of the major investors in mid-market distressed corporate debt.
“Following the success of the Ernest Hillier acquisition back in February, we are continuing to invest in Australian businesses where we see true potential for expansion and for growth,” said Paul McGowan, Global CEO of Re:Capital.
“This acquisition marks our third investment in Australia, where we believe there are enormous opportunities for specialist confectionery manufacturing businesses as demand increases,” Mr McGowan said. “We look forward to working with Betta and our global network to assist these businesses in taking their products to a worldwide audience,” he said.
James Turner, Investment Director for Re:Capital Australia, said that Betta Foods was “the perfect match” for the Confectionery Innovation Group and exactly the type of business the group sought to invest in. Mr Turner said Betta Foods had “strong manufacturing facilities, experienced and capable staff and an excellent product range”.
“It perfectly complements our Ernest Hillier chocolate business and we look forward to working to achieve the continued successful expansion of this company within the new Confectionery Innovation Group,” Mr Turner said.
Mark Campbell, CEO of Hillier’s Chocolates, said food manufacturing was “going from strength to strength here in Victoria” and that the formation of the Confectionery Innovation Group “highlights just how much demand there is for premium quality, handcrafted chocolate and confectionery”.
“We are seeing very high demand for Australian made products, particularly from overseas markets, and I am thrilled that Re:Capital has once again chosen to invest in an expanding business here in Australia,” Mr Campbell said. “It is a very exciting time for food manufacturing in Australia,” he said.
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