Freedom Foods Group has announced the sale of its cereal and snacks operations to the iconic Australian consumer food company The Arnott’s Group as part of its ongoing program to simplify its business structure and product range.
According to the Group’s statement, the sale includes the cereal and snacks manufacturing facilities in Leeton and Darlington Point in NSW and in Dandenong in Victoria, as well as brands associated with the business, including Freedom Foods, Messy Monkeys, Heritage Mill, Arnold’s Farm and Barley+.
“Freedom Foods Group has now reached an agreement with The Arnott’s Group for the sale of certain assets and liabilities of the cereal and snacks business for A$20 million in cash,” reads the statement.
“Net cash proceeds are estimated at A$11 million after deducting costs associated with the transaction and associated equipment leases.”
The transaction, which excludes the Crankt Protein brand, will see the majority of Freedom Foods’ cereal and snacks employees transfer to the new owners, although Freedom Foods hinted that “some redundancies” might be forthcoming.
Freedom Foods Group Interim CEO Michael Perich said the company considered The Arnott’s Group “a highly complementary owner of Cereal and Snacks”.
“We believe the Cereal and Snacks business will thrive under an owner such as The Arnott’s Group, which is committed to investing in the business and employees to ensure a sustainable and successful future,” Mr Perich continued.
“The decision is consistent with the new executive team’s strategy of simplifying both our business structure and product range to ensure we are maximizing growth opportunities in Dairy and Nutritionals and Plant-based Beverages.”
The Arnott’s Group CEO George Zoghbi said the acquisition would provide the company with new capabilities in portable snacks and allergen-free products, including gluten-free foods and muesli bars.
“This purchase of manufacturing sites and leading consumer brands from Freedom Foods Group will accelerate our strategy of entering new product categories and unlock innovation to benefit customers and consumers,” Mr Zoghbi added.
“This will add three Australian manufacturing sites to our already well-invested domestic supply chain. Once the purchase is finalised, our domestic manufacturing network will extend across eastern Australia from Virginia in Queensland, Huntingwood, Leeton and Darlington Point in NSW to Shepparton and Dandenong on Victoria and Marleston in South Australia.”
The transaction is expected to complete on 1 March 2021.