Contract catering giants gobble up independent firms

01 January 2000
Contract catering giants gobble up independent firms

By Gaby Huddart

The trend for the contract catering industry's giants to swallow up smaller, independent operators continued this week with both Granda Food Services and Gardner Merchant making acquisitions.

In the larger of the two deals, Granda Food Services snapped up one of the largest remaining independent contractors, Bromwich Catering, for an undisclosed sum. The deal brings it an extra £18m a year in turnover and 130 more contracts spread across the UK.

Garner Merchant, meanwhile, bought Edinburgh market leader in the leisure and event catering market in Scotland - which turns over about £4m a year.

Speaking to Caterer about the Bromwihc acquisition, Alastair Storey, Granada Food said it marked the latest step in the company's drive to grow its share of the UK market.

"We want to grow both organically and though acquisition and this deal fits with that strategy," he said. "The existing Bromwich team will stay in place and the company will continue to trade as it has done, while we will bring it benefits in IT and support services."

Frank Jones, Bromwich's chairman, said he had decided to sell the business to Granada because he was 62 years old and felt it was the best way of assuring its future.

"My prime concern was to preserve a family company which was established in 1837," he said. "After 42 years' experience in the industry, I decided if I could do a deal with Granada then that was the best way to go.

"It is a tough company and it took four-and-a-half months of negotiations to agree, but I'm pleased because I have got what I wanted. The Bromwich tradition will stay and the jobs of both the management and operations staff are safe," he explained.

Mr Jones is to remain as non-executive chairman of the company for a year and will then be involved on a consultancy basis. Managing director Bill Webster will now report directly to Mr Storey.

In an interview with Caterer about his decision to sell Wheatsheaf Catering, Chris Robinson, managing director, echoed Mr Jones. He said he also wanted to best assure his company's future and had been in talks with Gardner Merchant for about a year.

"For us to grow to the next stage would have taken a quantum leap in terms of capital investment but the acquisition by Gardner Merchant allows us to do that," he said.

Wheatsheaf will continue to trade as an independent identity within Garner Merchant's group of leisure companies.

Mr Robinson's role is to be expanded: he will also take charge of a number of Gardner Merchant's existing contracts in Scotland.

  • Granda Hospitality Group has paid £1.25m for a former office building in Battersea, London, which will be turned into a 83-bedroom Travelodge. The 25,000sq ft site was sold by the Churchmanor Estates Company through property agent Devitts.
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