Jacob Fruitfield negotiating to buy Burton's

Jacob Fruitfield, the Tallaght-based company headed by Michael Carey, has entered exclusive negotiations to acquire Burton's Foods, the UK's second-biggest biscuit company, in a deal believed to be worth more than £200 million (€297 million).

It is understood that Jacob Fruitfield has been granted a two-week exclusive period to conclude the deal for Burton's, whose brands include Wagon Wheels and Jammie Dodger biscuits.

Burton's has four manufacturing plants in the UK.

The Irish company is set to beat Duke Street Capital, a private equity group in the UK, in the race to secure the company.

Acquiring Burton's would be a major coup for Mr Carey and his fellow investors.

Jacob Fruitfield has been on a buying spree in recent years, taking over the Jacob and Fruitfield businesses and buying the Real Irish Food Company.

Its brands include Jacob's Cream Crackers and Fig Rolls, Silvermints and Yorkshire Toffees, and Little Chip and Old Time marmalades.

Mr Carey lost out last year in the bidding to acquire the Tayto snack food company from C&C, with Ray Coyle's Largo Foods securing the deal.

No comment was available from the Irish food group or from Burton's Foods.

Burton's is owned by HM Capital, a private equity group in the United States. HM acquired the company in late 2000, paying £130 million to Associated British Foods for the business.

Latest accounts for Burton's show it earned profits of £4 million on turnover of £287 million in the year to the end of December 2005.

By contrast, Jacob Fruitfield, which is backed by Lioncourt Capital, an investment vehicle for Michael Tunney and David Andrews, had revenues of €89 million for the 12 months to the end of December 2005.

Its operating profit during this period fell from €6.6 million to €4.9 million.

When interest charges and tax are stripped out, the company was left with a profit of €441,000.

Figures for 2006 have not yet been lodged with the Companies Office here but Mr Carey has previously said he expected revenue for last year to reach €110 million.

Jacob Fruitfield also has significant property assets. It owns two factories in Tallaght and a facility in Drogheda, Co Louth.

Property sources have speculated that the company is planning to sell at least one of the properties in Tallaght. It is understood, however, that the Irish food group has no current plans to offload any of its properties.

Mr Carey founded the company in July 2004 and initially acquired the Fruitfield business from Nestlé.

He later bought W&R Jacob from Danone and added the Real Irish Food Company in 2005.