Finsbury Foods sells Free From business

Finsbury Food Group, which manufactures cake, bread and bakery goods, has sold its Free From business in order to focus on its core cake and bread businesses.

Finsbury Food Group, which manufactures cake, bread and bakery goods, has sold its Free From business in order to focus on its core cake and bread businesses.

The business, which consists of two subsidiaries, was sold to Genius Foods for around £21m on a debt-free, cash-free basis.

The group said the sale will transform its balance sheet, with a cash balance of around £17.7m paid to it on completion of the transaction, and a further £3.0m to be paid on the second anniversary of completion.

"This will allow Finsbury to focus on growing its cake and bread businesses, to further develop its licensed brand portfolio, and to take advantage of the right bolt on acquisitions to drive longer term value as opportunities and circumstance allow," it said.

The company will also use the consideration to pay down its outstanding debts.

John Duffy, the Chief Executive of Finsbury, said: "We believe that our decision to focus on our core Cake and Bread business is the group putting its best foot forward. The sale will allow the group to further invest, pay down debt, and take advantage of additional opportunities available to us, with the ultimate goal of driving shareholder value."

The share price rose 17.24% to 51p by 14:35 Thursday.

NR

Recommended

Broker safety – your questions answered
Investment strategy

Broker safety – your questions answered

Cris Sholto Heaton answers more of your questions about the safety of stockbroker accounts
25 Mar 2020
How demographics affects stock valuations
Investment strategy

How demographics affects stock valuations

New research suggests that stock and bond valuations are driven by the age of the population – at least in the US.
24 Feb 2020
Do you own shares in Sirius Minerals? Here’s what you need to do now
Stocks and shares

Do you own shares in Sirius Minerals? Here’s what you need to do now

Mining giant Anglo American has proposed a cash takeover of Yorkshire-based minnow Sirius Minerals. Unhappy shareholders must decide whether to accept…
20 Feb 2020

Most Popular

Why we won’t see a house-price crash in 2021
House prices

Why we won’t see a house-price crash in 2021

Lockdown sent house prices berserk as cooped up home-workers fled for bigger properties in the country. And while they won’t rise quite as much this y…
18 Jan 2021
Inflation is the easiest way out of this – just don’t expect politicians to admit it
Inflation

Inflation is the easiest way out of this – just don’t expect politicians to admit it

The UK government borrowed £34.1bn in December, a record amount for that month. Britain's debt pile now amounts to 100% of GDP. How are we going to pa…
22 Jan 2021
When will the US stockmarket bubble burst?
US stockmarkets

When will the US stockmarket bubble burst?

With US stocks more expensive than before the Wall Street crash of 1929, there are growing signs of “mania”. But what will push markets over the edge?
22 Jan 2021