United Biscuits refused to disclose the financial details or confirm the percentage stake it had acquired. Current A & P owners, the Assudamal Group, will retain a share of the firm and the current management team will remain.
The deal gives United Biscuits a manufacturing presence in Nigeria after exporting products for the market from the UK or producing locally under license for several decades.
Double digit growth
Jeff van der Eems, CEO for United Biscuits International, said: “The Nigerian market has strong potential for United Biscuits. It is Africa’s most populous country and the biscuit market is projected to continue to grow at double digit rates.”
The Nigerian biscuits market grew around 18% in value in 2013 driven by chocolate-coated biscuits, according to Euromonitor International.
The market is dominated by local players – a consequence of an import ban on foreign biscuits from 2003 to 2012. Yale Foods leads the market with a 38% value share.
Euromonitor expects a 4% compound annual growth rate CAGR for the sector in the coming years.
United Biscuits overseas sales will now make up 20% of the business. The company’s international sales have tripled since 2006, coming mainly from developing markets such as Africa, the Middle East, China and India.
The A & P Foods deal marks the second overseas investment for the UK firm after acquiring Saudi company Rana Confectionery Products in October last year.
UB’s African HQ is based in Nigeria. The firm has a strong position in West Africa and recently expanded to Kenya and Angola.
A & P Foods was set up to produce biscuits from Ikeja, Lagos by the Assudamal Group in 2002. The company owns the Haansbro biscuits brand and also produces chewing gum, boiled sweets and toffees. The firm operates three factories in the Lagos area.
A UB spokesperson told this site that the factories would eventually produce United Biscuits brands such as McVities. United Biscuits has also acquired a stake in A & P Food’s brands.
Sameer Vaswani, CEO of A & P Foods, said: ”A combination of our regional knowledge and a global biscuit brand such as McVitie’s puts the company in a position where it can grow strongly in the local market.”