3i invests £5m in Fosters Traditional Foods

3i and Royal Bank of Scotland, together with an MBI team of Stuart Robinson, Mike Thorne and Sue Garfitt, today announce that Fosters, one of the UK's leading distributors of premium food and confectionery products to the retail trade, has been acquired.

The existing Fosters Chairman (Nigel Foster) will exit the business completely and the existing Sales (Les Hoare), Operations (Robin Lambert) and Finance (Chris Neville) directors will remain in the business, with support from existing MD (Tony Foster) in the short term.

Founded in 1973, Fosters currently has a customer base in excess of 4,000 retailers throughout the UK, with coverage in most channels, servicing some of the top customers in the independents, multiples, department and convenience stores sectors from its primary distribution centre in Market Harborough.  The business grew significantly in the 1990s and has further expanded through the recent acquisitions of Home Recipe Foods, Wilson''s Fine English Foods, Sweetworld, The FoodFinders and Chambers Candy Company.  As a consequence, sales have grown significantly and Fosters is rapidly establishing itself as the ''dominant gateway'' supplying niche food brands to independent retail and food service channels.

The MBI team''s plan is to build upon an already successful business model with the incumbent management team and further develop new channels of distribution and product range.

Stuart Robinson and Mike Thorne are joining Fosters as Chairman and Group Managing Director respectively.  3i has successfully worked with Stuart and Mike on two other deals in the chilled food manufacturing and distribution industry, where they achieved significant sales and profit growth and drove successful exits and excellent investment returns for management and 3i.  Sue Garfitt will join the team as Managing Director at Market Harborough, with particular emphasis on customer and product development, adding real value to the top line growth strategy at Fosters.

Richard Bishop, 3i Director, commented: "Fosters is already a well established company and we look forward to supporting the business as it enters the next stage of its growth.  We are delighted in being able to back Stuart and Mike for the third time, and with the addition of Sue Garfitt, we believe this is a first class management team for this opportunity."

Stuart Robinson, chairman of Fosters, said: "I am delighted to be leading the team acquiring Fosters.  It is a highly successful and well managed business and I look forward to being part of the team that strengthens and cements Fosters'' position as the leading supplier of niche food brands to the UK retail and food service market." 

Advisors on the transaction also commented:

Ian Steele, Deloitte''s Head of Corporate Finance in Scotland & Northern Ireland said 
"Stuart Robinson, Mike Thorne and 3i are a proven partnership that has a track record of outstanding success in the food sector over the past 10 years.  Everyone involved in this transaction is absolutely convinced that this will be another successful venture for the team."