Allied Bakeries and Hovis owners in ‘potential merger talks’
Allied Bakeries owner, Associated British Foods (ABF) has confirmed they are in discussions with owners of Hovis, Endless LLP regarding a potential transaction.
In a statement in response to media speculation, ABF said there is “no certainty that a transaction will be concluded nor as to the terms of such as a transaction”.
It is not clear which company is purchasing the other.
As stated in their Interim Results Announcement on 29th April this year, Allied Bakeries continues to face what it calls a “very challenging market”.
“We are evaluating strategic options for Allied Bakeries against this backdrop and we remain committed to increasing long-term shareholder value,” added the statement.
“A further announcement will be made as and when appropriate.”
In their Interim Results Announcement, released on 29th April, ABF’s retail sales grew 1% to £4.5 billion, with growth in Europe and the US, while the retail environment in the UK and Ireland was “challenging”.
Good sales growth across most of the brands in grocery was offset by lower sales in US oils and Allied Bakeries, as expected. Its group performance saw revenue in line with the prior year, with growth in retail and ingredients offset by a decline in sugar.
“In Grocery, we remain focused on driving sales of our leading international and regionally-focused brands, underpinned by effective marketing investment and strong commercial execution,” read the report.
“We continue to expect overall performance this year to reflect the normalisation of profitability in our US-focused businesses, and an operating loss in Allied Bakeries.
“Allied Bakeries continues to face a very challenging market. We are evaluating strategic options for Allied Bakeries against this backdrop and we expect to provide an update in H2 2025.”
