A merger agreement has been reached between two of the 海角视频's largest bread manufacturers, Hovis and Kingsmill, following months of negotiations.
Associated British Foods (ABF), the parent company of Kingsmill via Allied Bakeries, has struck a deal with investment firm Endless, the owner of Hovis, to acquire the brand, as reported by .
The financial details of the transaction have yet to be disclosed but are anticipated in the forthcoming months.
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Discussions about a potential merger between Hovis and Kingsmill first came to light in May.
Kingsmill profits 'increasingly challenged'
In a statement released to the London Stock Exchange, Kingsmill's owner said: "As stated at the interim results, Associated British Foods plc (ABF) has been evaluating a range of strategic options for Allied Bakeries, its 海角视频 bakery business.
"Profitability at Allied Bakeries has been increasingly challenged in recent years by a decline in demand for pre-sliced, packaged bread and a loss of scale in Allied Bakeries' nationwide distribution network serving the major retailers with daily delivery of bread and bakery goods.
"Following this review, ABF announces today that it has reached an agreement to acquire Hovis Group Limited from Endless LLP.
"Hovis Group is an integrated bakery business, engaged in the production and distribution of bread and bakery products in the 海角视频.
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"The acquisition will combine the production and distribution activities of the two businesses, driving significant costs synergies and efficiencies, to create a profitable 海角视频 bread business that is sustainable over the long term.
"The combined business will be better placed to compete effectively and to establish a stable platform for product innovation in the segments of the 海角视频 bakery category that are growing as a result of changing consumer tastes and needs.
"This will include improvement in existing products and expansion into new product ranges."
Losses widen at Hovis before takeover
Last month, City AM reported that losses had deepened at Hovis during its most recent financial year.
The firm's pre-tax losses expanded from £3.6m to £4.7m in the year to 28 September, 2024.
Documents filed with Companies House also revealed its turnover reached £446.8m for the 12 months, falling from the £489m it achieved for the previous year.
Allied Bakeries was established in 1935 by Wilard Garfield Weston, whilst Hovis originated in 1890 in Stoke-On-Trent.
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The bakery served as the predecessor to ABF. Allied Bakeries combined with Weston Foods in 1939, with the company name changing to Associated British Food in 1960.
ABF controls a varied portfolio of brands, spanning from Primark to Twinings Ovaltine and British Sugar.
George Weston, chief executive of ABF, said: "This transaction will create a 海角视频 bakeries business that is both profitable and sustainable over the long term.
"Supporting the Hovis and Kingsmill brands with well-invested and efficient operations will also enable innovation and growth."
"This solution will create value for shareholders, provide greater choice for consumers and increase efficiencies for customers."