Typhoo enters administration as it seeks buyer

Typhoo Tea has confirmed it has entered administration, after planning the move to restructure the business earlier this month.

Finance and restructuring firm Kroll has been appointed as the administrator, and is tasked with negotiating a rescue deal for the 121-year-old business, which is understood to currently have a workforce of under 100 staff.

A Kroll spokesperson told The Caterer: “Phil Dakin, Janet Burt and Benjamin Wiles of Kroll were appointed joint administrators of Typhoo Tea Ltd (in administration) on 27 November 2024.

“As reported recently, the company has experienced significant cash flow constraints as a result of supply chain disruptions and subsequent service issues. The company has been exploring a sale of the business and assets which is in the process of concluding.

“The administration process provides Typhoo Tea with protection, allowing the joint administrators to finalise the sale in order to rescue the business.”

A potential buyer has already stepped forward in the form of Supreme, a London-listed battery and vape supplier. This would not be the business’ first foray into the beverages market, as in June this year it acquired Acorn Topco, the parent company of Clearly Drinks, which owns soft drinks brands including Clearly Drinks and Rola Cola.

Supreme stated: “The board of Supreme can confirm that it is currently participating in a process regarding the potential acquisition of Typhoo Tea.

“Whilst discussions with the administrators are now at an advanced stage, there can be no certainty that the potential acquisition will be completed. No final terms of the potential acquisition have been agreed but the company can however confirm that any potential offer would be funded by Supreme’s existing bank facilities.”

Typhoo’s most recent financial results for the year ended 30 September 2023 showed that losses widened from £9.6m in 2022 to £38m last year. Sales also fell from £33.7m to £25.3m.

The Bristol-headquartered company’s annual report stated that exceptional costs of £24m were generated last year due to executing a major transformation plan that included discontinuing unprofitable lines and the closure of its factory in Moreton, Merseyside.

However, in August 2023 a group of trespassers broke into the Moreton site and caused “extensive damage”, resulting in low stock levels and unfulfilled orders in the immediate aftermath, and delaying the completion of the sale to June 2024.

Stock availability was also negatively impacted by general tea paper shortages in the UK during the year, which meant Typhoo was not able to fulfil all customer orders.

Since 2021, Typhoo has been majority-owned by private equity firm Zetland Capital, which purchased the company from Apeejay Surrendra Group. The Indian conglomerate itself bought the business from Premier Foods in 2005.

Typhoo supplies the hospitality industry with bulk packs of teabags through wholesalers including Brakes, Mellcrest, Pilgrim Foodservice and Turner Price.