North East wholesaler Kitwave has agreed to a significant £251m takeover deal by a prominent US private equity firm, heralding a transformative phase for the long-established business. The company, which originated from a single site in 1987, has announced to its shareholders that it has reached an agreement on the terms of a recommended all-cash acquisition. This acquisition is being facilitated by BidCo, a newly-incorporated company that is backed by OEP Capital Advisers LP, a major player in the private equity sector.
Valuation and Strategic Vision
Kitwave, which made its debut on the AIM market in May 2021, has disclosed that this deal values the entire issued and to-be-issued share capital of the company at approximately £251 million. OEP has expressed strong confidence in the acquisition, viewing it as a compelling opportunity to support and accelerate the growth trajectory of one of the United Kingdom's leading delivered wholesale groups. The firm emphasised that Kitwave has built a robust platform within the competitive UK wholesale landscape, operating through an extensive nationwide network with a proven track record of sustainable growth, achieved both organically and through strategic mergers and acquisitions.
Resilience and Expansion Prospects
In a formal Stock Market announcement, OEP highlighted Kitwave as a resilient and attractive business with solid foundations poised for continued expansion. The wholesaler benefits from deep and longstanding supplier relationships, a broad and diverse product range, and high delivery service levels that set it apart in the industry. Kitwave's operational model effectively combines national reach with a keen regional focus, underpinned by a modern logistics infrastructure and increasingly digitalised ordering capabilities. This customer diversity further bolsters the company's stability and enhances its long-term growth prospects, making it an appealing investment.
Evolution and Growth Journey
Based in North Shields, Kitwave initially concentrated on confectionery and convenience goods for local independent shops. However, the business has undergone substantial growth over the years, driven by a series of strategic acquisitions. Key purchases include Automatic Retailing and Eden Farm, which enabled Kitwave to expand its portfolio to include frozen, chilled, and own-label products, while simultaneously enhancing its UK-wide delivery capabilities. Prior to its listing on AIM in May 2022, the company also received significant backing from NVM Private Equity between 2011 and 2020, which helped fuel its early development.
Recent Acquisitions and Leadership Insights
Since becoming a public entity, Kitwave has continued its expansion through further acquisitions. In 2024, the company acquired Creed Catering Supplies, a family-owned food wholesaler based in Gloucestershire that serves the leisure, hospitality, education, and care sectors, in a deal worth £70 million. That same year, Kitwave also added Total Foodservice, another Northern wholesaler, to its group in a £21 million transaction. Ben Maxted, the Chief Executive Officer of Kitwave, remarked on this evolution, stating that since the company went public in 2021, it has rapidly transformed from a regional foodservice operator into an enlarged UK-wide delivered wholesale business. He expressed enthusiasm about partnering with OEP, noting their excellent track record in helping businesses scale significantly. Maxted believes that transitioning to a private company will afford Kitwave greater financial flexibility to achieve its ambitious goals, and he extended gratitude to shareholders for their steadfast support throughout its public tenure.
Partnership and Future Outlook
Ori Birnboim, a partner at OEP, shared his excitement about the recommended cash acquisition, describing Kitwave as a high-quality national distribution platform within the attractive UK grocery and foodservice wholesale market. He praised the company for establishing a reputation for excellence in service quality, product availability, and strong customer and supplier relationships. Similarly, Steve Lunau, another partner at OEP, expressed delight at the opportunity to partner with Kitwave to further strengthen its leading position in the market. He affirmed full support for Kitwave's vision for long-term growth and expressed confidence that their partnership will enable the company to accelerate its strategic initiatives. Both partners look forward to supporting Ben Maxted and the management team as they continue the impressive growth achieved in recent years.
