Liverpool / UK. (rgf) British Real Good Food Company PLC (RGF) announces that it has agreed terms for the sale of the business and certain assets of its non-core trading business, Garrett Ingredients Limited, to Kent Foods Limited for a consideration of approximately 1.8 million GBP payable in cash, on a debt free/cash free basis, some 1 million GBP of which relates to goodwill, with the remainder adjusting principally to reflect the agreed stock valuation. The funds raised will be used to reduce the Group’s indebtedness. The sale is expected to complete on 20 April.
Garretts, which sources dairy, sugar and other specialist food ingredients and sells them to large, medium and small food manufacturers across the UK, has been part of Real Good Food PLC since 2005. The Board believes that the business has more in common with Kent whose skills and aptitude are better suited to managing its contracts, given Real Good Food’s resources are being increasingly focused on serving the end consumer. In the Group’s financial year ended 31 March 2017, Garretts contributed 21.3 million GBP of revenues and an operating loss of 0.9 million GBP. It had net assets of 1.9 million GBP as at 31 March 2017 and the Group expects to report a modest loss on the disposal.
Hugh Cawley, Chief Executive, said: «We are pleased to have agreed the sale of this small, non-core business as part of our plan to improve the Group’s performance».