Takeover deal at 160-year-old Manchester biscuit maker

Greater Manchester biscuit maker Hill Biscuits has undergone a management buyout (MBO) with the help of private equity investor LDC.

Following the deal, the 160-year-old manufacturer plans to invest millions in increasing its production capacity and developing new products.

The Manchester-based firm said it will also seek strategic acquisitions to scale and diversify, alongside implementing a new international sales strategy to boost growth in overseas markets.

Founded by John and Sarah Hill as a small shop in Dukinfield in 1855, today Hill Biscuits has annual sales of £20m and produces more than 30m biscuits every week, with key products including digestives, bourbons, custard creams, malted milks, ginger nuts and gingerbread men.

The MBO was headed up by managing director Steven Wetherby. Simon Braham, John Clarke and Ged Gould led on LDC’s investment to provide an exit for the Bennett family, who bought the company in 1980 out of food giant Rowntree.

Steven Wetherby said: “Partnering with LDC will enable us to drive significant investment into the business for the benefit of our customers, adding greater production capacity and innovative new ranges, whilst staying focused on our core offering of quality, value for money products.

“LDC’s experience and track record in the sector made them an ideal fit for us. They also quickly understood our ambition for the business and shared our passion for growth. This unlocks a whole new future for a business with a fantastic history.”

LDC investment director Simon Braham commented: “Hill is a classic example of a business with latent potential.

“The shareholders have built a great business over the years and the current management team has an ambitious vision for forward growth.”

He added: “We’re excited to become part of the next chapter for Hill in developing its scale, strength and success both at home and overseas.”

The deal is the LDC North West team’s third transaction this year. During the last three years, the investor has ploughed over £250m into businesses and completed 14 deals at its Manchester office alone.

LDC senior director Ged Gould said the firm’s investment activity serves as a barometer of the North West economy’s health and wellbeing, as well as signaling the optimism of owner-managers as they seek to grow their companies.

He explained: “There are businesses just like Hill across the North West with exciting prospects ahead. We’re keen to get the message to those management teams that LDC has the appetite and capital to support their expansion.”

A team from Yorkshire Bank that included Jane Hartley, senior director, and Chris Walls, associate director, corporate and structure finance, provided banking facilities. Law firm Addleshaw Goddard provided banking legal advice.

Zeus and DWF advised the vendors and Pannone the management team. Mazars and Pinsent Masons advised LDC.