April 2, 2025 – Greencore, a prominent British convenience food manufacturer, agreed to purchase its rival Bakkavor in a US$ 1.6 billion deal on Wednesday. This acquisition will create a combined convenience food business in Britain with revenues of around £4 billion.
Earlier, Bakkavor’s board of directors rejected two offers, stating that they undervalued the company. However, today, Bakkavor announced that it would accept Greencore’s latest offer of US$ 1.6 billion.
Greencore, renowned for its salads, sandwiches, and ready meals, supplies all leading UK supermarkets, while Bakkavor’s retail customers include Waitrose, Tesco, and M&S. Bakkavor shareholders, under the agreement, will get 85 pence in cash and 0.604 Greencore shares per Bakkavor share.
The new acquisition is expected to strengthen Bakkavor’s market position by increasing its production capacity and expanding its customer base. It will help the company to meet growing demand for pre-packaged convenience foods, leading to growth of the ready to eat food sector.
According to Coherent Market Insights (CMI), the ready to eat food industry size is set to total US$ 312.25 billion in 2032. Global demand for ready to eat food products will likely rise at 7.7% CAGR. Rising demand for convenience foods and increasing strategies, like that of Greencore-Bakkavor acquisition, will play a key role in shaping this growth.
“Greencore’s acquisition of Bakkavor aligns with the company’s strategy to expand its footprint in the United Kingdom fresh prepared food sector. It is expected to help the company in driving efficiencies in supply chain operations and fostering production innovation,” says a senior analyst at CMI.”
The merger combines Greencore’s expertise in salads, sandwiches, sushi, and other products with Bakkavor’s diverse offerings, including fresh-prepared meals, desserts, and pizzas. This expanded range will empower the new business to meet evolving consumer preferences.
The acquisition is expected to help Greencore improve its production efficiency and reduce overall costs. Courtesy of this merger, the company can enhance its distribution network as well as strengthen its relationships with major retailers, ensuring presence across different food categories.
Formation of the new food-to-go giant may prompt competitors to reevaluate their strategies. They might also consider adopting strategies like acquisitions and partnerships to solidify their position in the global ready to eat food industry.
Sources:
News Outlet: Reuters
Multimedia Company: FoodBev Media Ltd
