Samworth Brothers buys Urban Eats
UK food manufacturer Samworth Brothers has paid £6.4 million for Urban Eats, the sandwich brand of out-of-business Adelie Foods
Samworth Brothers has acquired Urban Eats, the UK sandwich brand owned by Adelie Foods, as assets of the out-of-business company went on sale. Headquartered in Leicester, Samworth manufactures chilled and ambient foods, both own-label and branded. The company paid £6.4 million for the Urban Eats brand and associated intellectual property, and £475,000 for plant and machinery from Adelie Foods’ Southall site in West London.
Last May, Adelie Foods went into administration after four years struggling with losses, and a team of restructuring partners at Deloitte was appointed to investigate sale options. The company owed its private equity owner, suppliers and staff approximately £100 million.
Joint administrators from Deloitte failed to find a buyer for the food business, which resulted in 2,169 layoffs.
As Adelie’s assets went on sale, other buyers struck a deal, including Real Wrap, Winterbotham Derby and Hollieco, which acquired equipment and machinery from various Adelie’s sites.
Real Wrap, a sandwich and food-to-go supplier, paid £122,500 for all plant and machinery from Adelie’s Wembley and Southall factories in London. Winterbotham Darby, an olives and antipasti supplier, acquired plant and machinery from Adelie’s Redmoor factory in Milton Keynes for £750,000, and management consultancy firm Hollieco paid approximately £42,500 for selected plant and machinery from Adelie’s facilities in Heathrow.
The sale of Adelie’s distribution sites in Tamworth, Haydock, Cardiff and Kilmarnock has generated £24,000 to date, and invoice finance provider PNC is set to obtain £4.6 million from money still owed to Adelie by its customers.
Administrators have managed to raise approximately £7.8 million from the sale of Adelie’s assets, which is insufficient to pay all Adelie’s creditors in full, including £66 million in debt to Intermediate Capital Group, its private equity owner.
Unsecured creditors, representing more than 700 claims and a total of £24.3 million in debt, are not expected to be paid.
Adelie, which was one of the UK’s largest sandwich manufacturer, couldn’t rebound from the £9.4 million in operating loss recorded in the year to February 2020.
Intermediate Capital Group bought the business in 2016 from HIG Capital at a time when Adelie started to see sales drop following the loss of retail contracts with Sainsbury’s and WH Smith. The Covid-19 crisis was the final blow to the company’s financials.