Brakes in deal to buy Woodward Foodservice

Brakes has agreed terms to aquire rival distributor Woodward Foodservice.

The deal, which will need the approval of the UK competition authorities, consolidates Brakes as the leading supplier in the foodservice market.

Brakes Group, subject to Office of Fair Trading approval, will acquire the Woodward business, including its eight distribution centres, for an undisclosed sum. Woodward's current management will continue to run the brand as part of Brakes' operation.

The plan is that the Woodward brand will be retained alongside other specialist businesses including M&J Seafood, Pauleys, Prime Meats, Country Choice and Wild Harvest. Woodward branded products will be added to the Brakes range.

Woodward's majority shareholder is Icelandic investor Baugur Group, which is known to be exiting its non-retail UK investments. Baugur acquired Woodward as part of the Big Food Group, which also included cash and carry group Booker and frozen food retailer Iceland. Big Food was broken up in 2005.

In 2006, Woodward acquired competitor DBC Foodservice, confirming its position as the number three delivered wholesaler in the market behind Brakes and 3663. However, problems combining the Woodward and DBC operations are known to have frustrated Baugur. Last year saw Woodward chief executive Ed Hyslop and trading director Dave Howarth exit the business after reportedly falling out with Baugur.

Frank McKay, Brakes Group chief executive, said: "I am delighted we have been given the opportunity to join forces with Woodward Foodservice and I look forward to welcoming Woodward's employees and customers to the family of Brakes companies."

The deal will leave Brakes, 3663 and Booker as far and away the three biggest food suppliers to the pub trade, with a very fragmented picture across the rest of the distribution sector.