South African retailer Woolworths is poised to enhance its portfolio in the food and beverage industry by acquiring In2Food, a private-label supplier renowned for its ready meals, baked goods, snacks, and beverages. This strategic move aligns with emerging food and drink consumer trends.
Woolworths will acquire In2Food through its Woolworths Foods division from Old Mutual Private Equity, part of Cape Town’s Old Mutual Alternative Investments. The financial details remain undisclosed in a Woolworths filing with the Johannesburg stock exchange on March 17th, with the transaction pending regulatory approval from South Africa’s competition authority.
In2Food has a long-standing relationship with Woolworths, serving as a supplier for over 30 years and generating annual revenue of R5bn (approximately $298.4m). The company also provides fresh produce, seafood, and fruit juices, enhancing Woolworths’ ability to cater to the evolving food and drink business landscape.
Woolworths stated that this acquisition will “strengthen its supply chain resilience and further differentiate its premium food offering.” By doing so, they expect to achieve greater agility and efficiencies in their supply chain, ultimately improving market responsiveness and enhancing innovation capabilities.
Moreover, Woolworths believes that In2Food will create “new opportunities for accelerated growth in non-competing revenue streams,” particularly in the foodservice sector where the acquired entity operates. In2Food, recognized on LinkedIn for the transaction, operates eight manufacturing facilities throughout South Africa.
The existing management team at In2Food, which counts Woolworths as its primary client, will remain intact post-acquisition. Old Mutual Alternative Investments has not commented on the rationale behind the sale of In2Food or its timing, despite requests.
Old Mutual originally acquired a “significant minority” interest in In2Food back in 2016; however, it remains unclear whether this stake was later increased. In2Food was established in its current form in 2010 through the merger of Interfruit and Lombardi Foods, both of which had strong ties to Woolworths.
Since then, In2Food has expanded through strategic acquisitions, including fruit supplier Spring Valley Bapsfontien, Compass Bakery, and Newport Juices in 2013 and 2014, as detailed on In2Food’s website. Additionally, the company integrated the strawberry brand Echo Berry and Nibbly Bits into its portfolio in 2016, further solidifying its position in the food and beverage industry.
This acquisition by Woolworths marks a significant move within the rapidly evolving food and drink sector, ideally positioning the retailer to adapt to current consumer preferences and industry trends.
