Adelie Foods in administration as virus hits home
The food manufacturer, headquartered in Heathrow, operates from three manufacturing sites and five distribution facilities across the UK.
Adelie sells its products to a range of retail customers and contract caterers. Deloitte said that, given the consumer-focused nature of the business, COVID-19 and the associated lockdown measures had had a “significant adverse effect”
Prior to its appointment as administrator, Deloitte said that it had been engaged in a sale process. However, it was not possible to conclude a sale outside of administration protection. It said it would now investigate sale options with a view to concluding a transaction “as soon as possible”
Reports have mooted Greencore and Bakkavor as potential suitors, but this has not been confirmed.
No immediate redundancies
Deloitte said the company employed approximately 2,200 people and, while no immediate redundancies were being made, this position would be revisited subject to how the sale process progressed over the coming days.
Rob Harding, restructuring partner at Deloitte and joint administrator, said: “The current pandemic is having a devastating effect on consumer-facing businesses and suppliers into them, such as Adelie.
COVID-19
“The impact of COVID-19 on the company’s order book resulted in a material funding requirement and, as a result, we have been working hard with Adelie’s management to try and secure a buyer to ensure the right longer-term future for the business.”
He said that Deloitte had been hopeful that a sale agreed with a trade buyer would obtain the necessary regulatory approvals to enable it to proceed to completion. But he added that this had not been possible.
Meanwhile, Clive Black, head of research at Shore Capital, said in a report that if new owners were not found in time, it could mean the closure of Adelie’s manufacturing activities and the displacement of its business to other players
He said: “We are not confident that new owners will be found. However, the only two key players with such capability and capacity that we are aware of in the UK are Greencore and Samworth Bros.”
