Irn-Bru maker AG Barr gains full control of one of UK’s fastest growing porridge brands

Irn-Bru maker AG Barr has taken full control of one of the UK’s fastest growing porridge brands, continuing its recent acquisition spree.

The soft drinks firm said it was bringing forward the acquisition of the remaining 38.2 per cent equity stake in Moma Foods from its founder Tom Mercer, and other minority shareholders, for £3.4 million. When Cumbernauld-based Barr bought its 61.8 per cent holding in Moma last December it entered into an option deed with Mercer and the other remaining shareholders which gave it an agreed path to full ownership over the following three years. Moma will remain a standalone business unit within the wider group.

Moma was founded by Mercer in 2006 as a challenger brand in the porridge market, using quality British jumbo oats. Most recently, the brand has diversified into the high growth plant-based milk sector, and is now the UK’s third largest oat milk brand. London-based Moma also produces a range of low sugar granola and bircher muesli branded products.

Roger White, chief executive of AG Barr, said: “We are delighted to bring forward the planned full ownership of the Moma business. This allows us to fully support the Moma business and brand, such that we can leverage the increased growth potential sooner than allowed for under the original acquisition structure. The completion of the acquisition is a further positive indication of AG Barr’s growth ambitions.”

Earlier this month, Barr revealed that it was swallowing Boost, the sports and energy soft drinks brand, in a deal worth up to £32m. It said the deal formed part of plans to develop its portfolio in “high growth and functional categories”.

The Boost brand, founded in 2001, primarily operates in the “functional beverage” sector spanning energy, sport and protein, with a strong market position in the UK independent retail channel. Bosses said “significant potential” existed for further growth and development of the product portfolio.

Barr has acquired 100 per cent of Boost’s issued share capital for an initial consideration of £20m, funded from cash reserves. An additional payment of up to £12m will be dependent on future revenue and profitability performance of the Boost business over a two year period, payable in cash.

In September, Barr said it would take “appropriate mitigating action” to keep a lid on costs as it faces up to the cost-of-living crisis and spiralling input costs. The firm warned that the squeeze on discretionary consumer spending was likely to impact purchasing behaviour in the months ahead as it reported a strong first-half performance.

Moma was founded by Tom Mercer in 2006 as a challenger brand in the porridge market, using quality British jumbo oats.

The group, which is also behind the likes of the Rubicon and Funkin brands, posted interim revenues of £157.9m, up 16.7 per cent on a similar period a year earlier. Adjusted profit before tax came in at £25.3m, an increase of 22.8 per cent, though the reported profit inched up just 1.2 per cent to £24.7m. An interim dividend of 2.5p per share was declared, an increase on the prior year of 25 per cent. White said the business was seeing cost pressures mount “across the board”.