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Fredericks Dairies Sold to R&R Ice Cream

April 2013 £49m

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exit strategy

Project Vanilla

April 2013 £49m

About the client

Rickitt Mitchell advised Frank and Philip Frederick on the £49m disposal of their business, Fredericks Dairies Limited (FDL), to R&R Ice Cream (R&R), Europe’s largest own-label ice cream manufacturer.

Skelmersdale-based FDL is the UK's leading supplier of ice cream products to the major supermarkets, manufacturing for brands including Cadbury, Del Monte, Vimto, Britvic and Barratt's. FDL was the sole supplier of ice cream to the 2012 Olympic and Paralympic Games.

FDL reported revenue of £41m and operating profit of £3.9m in the year to 31st August 2012

About the deal

The deal represented a 12.5x EV/EBITA multiple with 100% cash realised at completion.

Rickitt Mitchell negotiated a significant improvement on the original offer price during the deal process.

A complex business reorganisation was required to spin-out FDL’s cold storage operation before completion.

The transaction was structured on a staggered exchange and completion basis to accommodate an OFT enquiry. The Frederick brothers also retained their Freezeserve cold storage and distribution business based at Simonswood, Lancashire.
The Financial Times reported the deal as being strategically key to the subsequent €850m acquisition of R&R by PAI Partners.

I've had a good relationship with Stuart Moss at Rickitt Mitchell for over 15 years and recently got in touch for some strategic planning advice. As a result, he helped us to demerge our operations into two separate companies to achieve better management focus. Not long afterwards, we were approached by a competitor interested in acquiring one of our businesses and Rickitt Mitchell then helped us to achieve a very satisfactory disposal of that business.

Frank Frederick | Managing Director | Fredericks Dairies