Fresh produce companies in merger
Two of the UK’s leading fresh produce suppliers, DGM Growers and Geest QV, have merged to become the sole supplier of fresh potatoes to Marks & Spencer in the UK in a deal part-funded by Lloyds TSB Corporate East Anglia team.Two of the UK’s leading fresh produce suppliers, DGM Growers and Geest QV, have merged to become the sole supplier of fresh potatoes to Marks & Spencer in the UK in a deal part-funded by Lloyds TSB Corporate East Anglia team.
The new company, Manor Fresh Limited, will have an annual turnover approaching £50 million and over 200 employees, consolidated onto a single site in Holbeach Hurn near Spalding, previously home to Geest QV.
DGM Growers’ Pode Hole site, also near Spalding, will be sold once staff transfer has been completed, which is expected to happen by July 2006.
The merger was facilitated with a £5 million overdraft facility implemented by Lloyds TSB Corporate in Cambridge after the bank won the portfolio in a three-way competitive tender.
Lloyds TSB Corporate’s Relationship Director, Neil Mackie, said: “This is a true joint venture and we will be financing the working capital needed for the deal. We are delighted to be involved with this expanding venture.”
Manor Fresh can now concentrate on the consolidation and the expansion of its non-potato activities as it also supplies a major share of M&S’s fresh vegetable business, both conventional and organic.
Manor Fresh director, Mike Musk, said: “As DGM and Geest QV were both suppliers to M&S is seeking to rationalise its supply chain and we did not see that operating two independent units was a viable long term option.
“We are now spending around £1 million on updating equipment, reconfiguring the potato packing process and converting the existing building.”
Ian Craig, Manor Fresh’s managing director, added: “The increased focus, as well as the synergies we can realise, will benefit our customers in terms of service and product quality, value and innovation.”
As well as Spalding, Manor Fresh works in Evesham, Inverness, Jersey and Portugal, always close to its grower base to keep on top of quality and to ensure it has one of the fastest supply chains in the business.
The two shareholders in Manor Fresh Limited, each with a 50 per cent stake, will be DGM Growers Ltd and Geest QV Ltd. DGM is a subsidiary of M&W Mack and was acquired in 2003 while Geest QV is a joint venture between QV Foods Ltd and Geest Foods Ltd.