The Jammie Dodger and Maryland cookie maker was sold earlier this week by previous owners Canadian Imperial Bank of Commerce and US private equity firm Apollo Global Management to Canadian pension fund Ontario Teachers’ Pension Plan (OTPP) for around £350m ($565m).
Mintel: M&A’s needed to grow market share
Mintel global food trends analyst Jodie Minotto told ConfectioneryNews that OTPP may need to look at overseas to businesses to grow Burton’s presence in international markets.
“Although they are the number two player in the UK biscuit market, they only had a 4% market share (value) in 2012. With declining biscuit consumption in the UK, United Biscuits expanding their global footprint and an ambitious Mondelēz growing their share of the local market, Burton’s need to look at acquisitions to expand their local and/or international presence.”
She added: “The new owners appear to have the resources to facilitate the expansion of Burtons via M&A’s, which is very positive. It is also positive that they have left the existing management team intact.”
Ben Clarke retained his position as CEO of the firm.
Euromonitor: Cadbury license will help overseas seas
Lamine Lahouasnia, head of packaged food research at Euromonitor International, said that since 85% of Burton's Biscuits' sales came in the UK, it was likely to target international markets.
"The challenge for the company will be that its flagship brands (Jammie Dodger, Wagon Wheel, etc…) with the exception of Maryland are relatively UK specific and will be difficult to internationalize.
"Fortunately the company has a long standing agreement to produce Cadbury’s biscuits under license and this could potentially be its route to the international market. As the world’s 2nd largest confectionery brand, Cadbury’s is a much more familiar name and likely to be much easier to sell in international biscuit markets. Of course, the question of whether Mondelez will want Burton Food’s to produce its biscuits outside the UK is another matter."
What’s included in the deal?
Burton’s manufactures Maryland cookies, Jammie Dodgers and Wagon Wheels. It also produces Cadbury biscuits under licence.
The OTPP deal includes the entire Burton’s business including all rights under the Cadbury license as well as manufacturing plants in Blackpool, Edinburgh and Llantarnam as well as the firm’s chocolate refinery in Moreton.
Burton’s is headquartered in St. Albans, UK, and employs over 2,000 people.