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| Kingsmill to buy Hovis in move that would create UK's biggest bread producer | Kingsmill to buy Hovis in move that would create UK's biggest bread producer |
| (about 2 hours later) | |
| Kingsmill's owner has said it has agreed to buy rival Hovis and plans to merge the companies in a move that would create the UK's biggest bread brand. | Kingsmill's owner has said it has agreed to buy rival Hovis and plans to merge the companies in a move that would create the UK's biggest bread brand. |
| Associated British Foods (ABF) which also owns Primark, Ryvita and Twinings, said it would cut costs to make the two currently loss-making businesses profitable. | Associated British Foods (ABF) which also owns Primark, Ryvita and Twinings, said it would cut costs to make the two currently loss-making businesses profitable. |
| The Unite union represents workers at Hovis and Kingsmill and warned it would "not tolerate attacks on jobs, pay or conditions". | The Unite union represents workers at Hovis and Kingsmill and warned it would "not tolerate attacks on jobs, pay or conditions". |
| Warburtons is the current market leader in UK breadmaking and the deal would need approval from the competition watchdog in order to go ahead. | Warburtons is the current market leader in UK breadmaking and the deal would need approval from the competition watchdog in order to go ahead. |
| Sales of Kingsmill and Hovis loaves are thought to have fallen flat due to a drop in demand for basic pre-packaged bread, as speciality breads such as sourdough and ciabatta took a bigger slice of the market. | Sales of Kingsmill and Hovis loaves are thought to have fallen flat due to a drop in demand for basic pre-packaged bread, as speciality breads such as sourdough and ciabatta took a bigger slice of the market. |
| Sandwiches and toast are also off the menu for some British consumers who are cutting back on carbohydrates in favour of high-protein diets. | Sandwiches and toast are also off the menu for some British consumers who are cutting back on carbohydrates in favour of high-protein diets. |
| ABF told investors on Friday it had reached an agreement to buy historic brand Hovis from private equity owner Endless. The BBC understands the deal is worth an estimated £75m. | |
| It said the combined business would be "better placed to compete effectively" and to create new products "as a result of changing consumer tastes and needs." | It said the combined business would be "better placed to compete effectively" and to create new products "as a result of changing consumer tastes and needs." |
| ABF's Allied Bakeries business, which makes Kingsmill and Allinson's bread, first confirmed talks over a potential deal three months ago. | ABF's Allied Bakeries business, which makes Kingsmill and Allinson's bread, first confirmed talks over a potential deal three months ago. |
| Hovis, which was founded in 1890, was bought by Endless in 2020 from Premier Foods, which owns the Mr Kipling brand. | Hovis, which was founded in 1890, was bought by Endless in 2020 from Premier Foods, which owns the Mr Kipling brand. |
| ABF said the deal would lead to "significant costs synergies and efficiencies" in an effort to create a sustainably profitable bread business. | ABF said the deal would lead to "significant costs synergies and efficiencies" in an effort to create a sustainably profitable bread business. |
| George Weston, chief executive of ABF said: "This solution will create value for shareholders, provide greater choice for consumers and increase efficiencies for customers." | George Weston, chief executive of ABF said: "This solution will create value for shareholders, provide greater choice for consumers and increase efficiencies for customers." |
| But Unite general secretary Sharon Graham said: "While there is still a long way to go before any buyout happens, Hovis and Kingsmill must ensure that jobs are protected." | But Unite general secretary Sharon Graham said: "While there is still a long way to go before any buyout happens, Hovis and Kingsmill must ensure that jobs are protected." |
| She said Unite would be working to ensure the two brands fully involve the union in any decisions that impact its members. | She said Unite would be working to ensure the two brands fully involve the union in any decisions that impact its members. |
| The deal requires approval from the Competition and Markets Authority. | The deal requires approval from the Competition and Markets Authority. |