Pentagon Foods / Phoenix Foods

www.phoenixfoods.co.uk

Transaction Type: Acquisition and Growth Capital
Status: Current Investment
Sector: Food Manufacture
Investment Date: August 2007
Deal Size: c £5 million

Endless Contact: Ian Brown

THE BUSINESS

Phoenix Foods Limited is a dry ingredients blender for a variety of products for UK supermarkets and branded manufacturers, with a diverse product range which includes hot chocolate drinks, flavoured teas, stuffings and cake mixes.

Prior to the transaction, the company had operated under the ownership of Unicheq Holdings Limited and had delivered steady results.  The company’s well invested 44,000 sq foot factory and warehouse facility in Corby Northamptonshire will provide the platform for growth which will be delivered by the introduction of the MBI team who will work closely with the company’s new customers as well as its existing customer base in developing innovative and exciting new products.  

Tony Lomax who led the MBI team stated “Our goal is to be seen as the preferred supplier of dry mix products in our chosen markets and being a centre of excellence for new dry mix product innovation and quality.”

INVESTMENT COMMENTARY

Endless has backed Pentagon Foods Limited, the vehicle established by Tony Lomax and four other members of the MBI team.  The £5m purchase of Phoenix ended an 18 month search for a company which would have the potential to meet the growth expectations of both Pentagon and Endless.  The company has secured a contract to supply dry mixes which are used to make fresh cakes and donuts which can be seen on the supermarkets shelves throughout the UK every day.

Aidan Robson, Investment Manager at Endless, said “We were attracted to this by the strength of the MBI team and the outstanding opportunity to grow the business from its well invested set-up.”

Tony Lomax, a former CEO of Wimpy Worldwide, also commented “Endless offered us a flexibility in their approach to funding which was refreshing and was not available from more traditional institutions.  This is the first investment by Pentagon and in partnership with Endless we hope to make further acquisitions in the food industry in the near future.”

This is the second investment by Endless in the Midlands since it opened its Birmingham office in Spring 2007.  Nick Leitch, who heads the Birmingham office for Endless, commented “We are finding the Midlands to be a receptive market for our offering and are delighted to have secured another investment so quickly.”  The MBI was a cross-regional transaction, having been led by North East based advisers Quantum Corporate Finance.  HSBC Bank plc provided term debt and working capital facilities.

 

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