15 March 2008 - Langholm Capital is delighted to announce the sale of Dorset Cereals to Wellness Foods. Dorset Cereals was acquired by Langholm Capital, the mid market specialist consumer private equity fund, in a management buy-in in April 2005.
Under Langholm Capital’s ownership, the brand has been successfully re-launched both in the UK and overseas. The brand has grown strongly in the muesli category which has provided a platform to create new products to extend into other cereal categories: porridge (Fruity Porridge and Perfectly Porridge), flakes (Naturally Light Flakes) and cereal bars (Chunky Slices). In 2007, total branded sales nearly doubled, with Dorset Cereals becoming the no.2 muesli brand in the UK, as well as the fastest growing mainstream breakfast cereals company overall.
In the period of Langholm Capital’s ownership there has been heavy investment in the business in both the factory and in brand development, with the number of employees more than doubling to over 100.
Dorset Cereal’s senior management team of Peter Farquhar, Nigel Horsman and Patrick Horton will remain with the business and Wellness Foods is highly supportive of management’s plans to grow the business both in the UK and overseas. Senior management will continue to be significant shareholders in the business.
Peter Farquhar, CEO of Dorset Cereals, said “Dorset Cereals is a perfect fit for Wellness Foods and Dorset Cereals will obtain many benefits from being part of Wellness Foods. This is a great transaction for consumers, customers and employees of Dorset Cereals and we are all very excited about taking Dorset Cereals to the next stage in its development.
Bert Wiegman, Partner of Langholm Capital, said “Dorset Cereals has been a highly successful investment for Langholm Capital’s investors. During our ownership we have worked closely with management, to develop the brand strategy and growth plans and seen branded UK sales accelerate strongly. The success demonstrates the benefits of Langholm Capital’s focussed approach of investing in high growth consumer facing companies and supporting management teams who can produce above average returns.”
Langholm Capital was advised on the transaction by McQueen and Travers Smith.