UK grocery sector sees major change

06 March 2012

LONDON: Less than a third of Britain's biggest grocery brands are now owned by UK-headquartered companies, a new report has revealed.

According to data collected by The Grocer, the trade magazine, and Nielsen, the insights provider, only 44 of the nation's leading 150 brands in this sector by value sales are assets belonging to domestic firms.

Overall, members of this elite group are owned by corporations from 15 countries, including Austria, France and Germany in Europe, Japan and Thailand in Asia, as well as the US.

Within the overall total, of the 91 brands which were first developed in the UK, just 36 remain the property of companies headquartered locally.

Among the recent high-profile examples of this trend was Kraft, the US food giant, paying £12bn to take over Cadbury, the confectionery manufacturer.

Innocent, the fast-growing smoothie brand established in 1999, sold a 20% stake to Coca-Cola in 2009, and the American soft drinks specialist has since taken a majority share in the company.

Richard Reed, a co-founder of Innocent, argued that its continued growth was dependent on such a move. "It's been achieved by investing in price and products, which we couldn't have afforded without the capitalisation of the business," he said.

Wiseman, the milk manufacturer, was acquired by Müller. The German dairy group has also now transferred its headquarters to Luxembourg, for £280m in January 2012.

"The combination ... makes strong commercial and strategic sense," Robert Wiseman, chairman of the British firm, said at the time. "Wiseman has its origins as a family business and ... it is heartening to know that the business will become part of another family-owned business in Müller."

Looking further back, Burton's Foods was taken over by the Imperial Bank of Commerce, from Canada, and Apollo Global Management, from the US, in 2009.

Grant Thornton, the consultancy, reported that 44 food and drink manufacturers from Britain have been acquired by overseas rivals since the beginning of last year.

Jonathan Warburton, chairman of Warburtons bakery, said: "Our business is wholly owned by the family and has more than 130 years of history. That means we have a greater commitment to the UK."

Data sourced from The Grocer; additional content by Warc staff