Premier Foods cuts debt with Quorn and Cauldron sale

11 April 2012

The UK's biggest meat-free food brands, Quorn and Cauldron, were set to change hands today after owner Premier Foods agreed a £205 million sale to slash debts.

The Hovis bread and Branston pickle maker will use the funds to shore up a balance sheet weakened by an acquisition spree before the credit crunch struck in 2007.

Quorn, launched nationally in 1994, makes meat-free mince, burgers and sausages while Cauldron is the UK's No 1 tofu brand.

Premier bought both businesses for a combined £191 million in 2005 but is focusing on the UK market and is unwilling to invest in developing Quorn overseas.

The firm will take a £25 million loss on the sale.

Both businesses will be sold to private equity firm Exponent, whose UK portfolio includes the UK's largest beds chain, Dreams.

The deal accelerates Premier's existing plans to cut its borrowing, shrinking debts by £200 million to £1.16 billion.

Premier is also in discussions over the sale of its £300 million own-label canning business and finance director Jim Smart said the firm remained "open-minded" over any further disposals.