July 5, 2018 Written by: Matthew Lewis

At the start of June, I read that frozen-food manufacturer, Aunt Bessie’s, is to be bought in a €240 million agreement. Nomad Foods Ltd– a US-listed investment business – struck a deal with the William Jackson Food Group, a 167-year-old family firm based in Yorkshire.

The news came only months after Nomad Foods also acquired the Goodfella’s Pizzabrand (as part of Green Isle Foods) for €225 million from Boparan Holdings. It has been a busy year for Nomad Foods with significant frozen-food portfolio expansion.

Blending brands

Aunt Bessie’s is a name that many of us are very familiar with in the region, known for their frozen potatoes and Yorkshire puddings which are both market leaders. It’s a name that has always traded on its local heritage and last year turned over a £20m profit from revenues of £108m.

On paper, the two firms probably couldn’t be more different. Nomad Foods is listed on the New York stock exchange, founded three years ago by a former hedge-fund manager and ex-investment banker. It is an enormous corporation and owns large international brands such as Findus and Birds Eye.

In contrast, William Jackson Food Group is a proud sixth-generation family firm based in Hessle. It ownsThe Food Doctorsnacks, Yorkshire Champion Bread, the organic vegetable box business, Abel & Cole, and even a local pub!So, I can only imagine that this is a deal that probably surprised many of their staff and stakeholders.

However, Stefan Descheemaeker, CEO of Nomad Foods, sees an apparent synergy between the firms:
“We are excited to welcome Aunt Bessie’s to Nomad Foods. Aunt Bessie’s iconic brand, positive values and strong product credentials align well with our existing portfolio […] As our second accretive acquisition in 2018, Aunt Bessie’s represents another step toward our goal of transforming the frozen food category and building a portfolio of best-in-class food brands.”

Merging staff

This deal impacts the Aunt Bessie’s factory in Hull which employs 400 people. Nomad Foods has stated that all current employees will transfer to Birds Eye when the deal is completed in autumn 2018, taking the group’s total workforce to 1,600. Wayne Hudson, the Birds Eye managing director, said:

“Aunt Bessie’s is an incredibly well-known brand. This is a growth story – we have no intentions to close the plant and are integrating it into the Nomad Birds Eye business.”

It would seem this is an excellent move for Nomad Foods and Birds Eye, so we have to hope that they manage the process well. Regardless of the size and type of organisation involved, mergers and acquisitions will inevitably create anxiety. Staff will likely now feel in a state of flux – some days reassured about job security and others wondering if the rug will be pulled from beneath them.

Personally, I think this is a great deal for Nomad Foods and potentially a fabulous opportunity for Aunt Bessie’s staff too. Frozen-food manufacturing is said to be growing faster than fresh, chilled, and “shelf-stable” food. According to an industry expert quoted in an article on FoodManufacture.co.uk, the £210m Aunt Bessie’s takeover ‘a very good deal’ for WJFG.

Overseeing the process

During the acquisition process, there are lots of management considerations. Here are just a few essential elements to be considered:

    • Manage: It is not uncommon for organisations to look for support from executive recruitment firms such as our own during such periods. We can identify short-term talent requirements, and sometimes this comes in the form of interim management. Although an organisation may well have competent staff in post, it can be beneficial to appoint external individuals to oversee processes who have a specialist skill set and experience in dealing with change planning. This frees up staff to continue with the “day job.”

 

    • Lead: Getting the right senior leaders in post is essential during periods of change. Confidence in the top tier can make an enormous difference in the success of a merger or acquisition. Our specialism is sourcing the right industry managers and leaders across sectors, from manufacturers or industrial firms to consumer organisations. Those in post need to have the right skills to oversee the process.

 

    • Change:Many companies get bought with a view to improving viability, whether that’s operationally, financially, through sales or general growth. It’s important the senior management team work together on a long-term strategy that identifies where fundamental changes are needed, but equally where they are not. Too much change made too quickly can be as detrimental as too little.

 

    • Empathise:The flip side of this scenario is that, usually, this type of wholesale change is something most people find unsettling. There are normally short-term concerns around the impact of change, how it may stifle a career, or even result in job loss. It is vital to understand that staff have a range of capacities and strategies for dealing with change and put support mechanisms in place.

 

    • Communicate: To my mind, probably the most critical element of an acquisition process is a robust and transparent communications plan that considers all stakeholders, from suppliers to staff. Marketing teams need to be heavily involved in the pre-planning stages before anything is announced internally or externally, to allay any unfounded fears quickly.

 

  • Engage: Leading on from this point, the most successful buy-outs that I have seen have been where staff are adequately consulted and engaged throughout the entire process. The communications, leadership, and support mechanisms referred to above all affect the overall levels of staff engagement.

If those in charge at Nomad Foods and Birds Eye manage the buy-out successfully (and as a group well-versed in such matters, I’m sure they will), Aunt Bessie’s will go from strength to strength, nestled amongst such established brands in the frozen-food-manufacturing industry.

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