In the announcement today, Olam said it will initially acquire 85 per cent of equity capital in BFI and 100 per cent of Britannia Storage and Distribution Limited (BSD), and then acquire the remaining 15 per cent in BFI within the next three years at a pre-agreed valuation.
The transaction, said Olam, involves the acquisition of BFI’s key assets and processing capabilities, which comprise melting plants, blending and refining facilities with a total capacity of 70,000 metric tonnes per annum. The plant also has warehousing, tank storage, modern packing, R&D and analytical laboratories.
Established in 1996 in Goole, Yorkshire England, BFI is one of the leading independent suppliers of speciality fats to the confectionery and snack food industries in the UK, with product categories including cocoa butter, cocoa butter equivalents and filling fats.
BSD, the logistics arm of the group, provides a vital link to ensure timely and cost competitive delivery of oils and fats from the ports of Felixstowe and Liverpool to its customer base, said Olam.
“BFI offers us the ability to supply refined liquid deodorised cocoa butter and other speciality fats,” commented Olam’s managing director, Gerry Manley, who added the takeover of the UK supplier would allow Olam to provide a fully traceable integrated supply chain of cocoa products from bean sourcing, processing and final delivery.
“Olam will provide BFI with marketing, hedging and ratio management expertise, market information and analysis as well as risk management solutions to customers,” said the Singapore company.
The transaction also offers customer sharing and product development synergies with Olam’s sheanut, edible nuts, palm and dairy businesses, observed the supplier.
“This vertical integration will offer BFI, which procures sheanuts for cocoa butter equivalents, palm fractions for numerous confectionery fat applications and dairy products for its butter oil business, the ability to access Olam’s position in the supply of these products and further product development and application,” added the Singapore based group.
Olam said that the acquisition would be funded through internal accruals.