Supreme, a UK-based manufacturer of drinks, protein powders and vapes, has acquired Typhoo Tea out of administration for £10.2m ($12.9m).
The deal encompasses Typhoo Tea’s inventory and trade receivables, which have been valued at £7.5m.
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In a statement, Supreme said it expected “the integration of the business to proceed without disruption to existing operations or customer service levels”.
Typhoo Tea, a 120-year-old brand, entered administration last month.
According to Supreme CEO Sandy Chadha, the acquisition is a “significant step” in the company’s “broader diversification strategy”.
The deal is expected to boost Supreme’s non-vape annualised sales to over £120m, approximately 50% of the group’s revenue. At present, vapes is Supreme’s largest business segment.
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By GlobalDataSupreme said Typhoo Tea’s “asset-light, outsourced model” would be supported by its “vertically integrated distribution platform”.
The company added it hopes to be able to develop “sales, marketing, and product innovation opportunities”.
Supreme is also looking to develop own-label products or licences under “well-recognised brands”.
Chadha added: “Having established our soft drinks division earlier in the year, we believe the addition of Typhoo Tea and its highly complementary blend of great value and premium tea brands, creates tangible cross-sell and product innovation opportunities in the near-term, alongside avenues into credible UK retailers that Supreme has been looking to partner with.”
In June, Supreme snapped up canned and bottled soft drinks producer Clearly Drinks.
Established in 1903, Typhoo Tea, is said to have been the first pre-packaged tea brand in the UK.
Its product range features black and decaffeinated teas, flavoured instants, herbal infusions and coffee under brands such as QT, Lift, and Heath & Heather.
For the year ending 30 September 2024, Typhoo Tea reported unaudited revenue of approximately £20m and a loss before tax of £4.6m.
Last week, Supreme released its first-half results for the period ending 30 September.
Revenue grew by 8% to £113m, driven in part by the acquisition of Clearly Drinks. Adjusted pre-tax profit increased by 25% to £14.7m, while adjusted EPS rose from 8.1 pence to 11.1 pence.
In the earnings report, Supreme mentioned it was “pursuing a buoyant and diverse M&A pipeline”, a statement made prior to the announcement of its bid for Typhoo Tea.
