Struggling bread business Hovis is to get £200m of investment under a deal that will hand a major slice of the operation to an American firm.
Premier Foods, which has owned Hovis since March 2007, hopes the creation of a joint venture with private equity firm Gores Group will help to reinvigorate the Hovis business after a long period of disappointing sales.
Los Angeles-based Gores is paying £30m for a 51% controlling stake in the Hovis and Mothers Pride business, which has 4,000 staff at 10 bakeries and five flour mills.
The deal is expected to unlock £200m in investment over the next five years, as well as enable Premier Foods to focus on its other brands such as Mr Kipling and Bisto.
Hovis was the first to advertise on British television in 1956 and went on to launch one of the most famous TV ads of all time in 1973 with the “Boy on the bike” directed by Ridley Scott and featuring the music from Dvorak’s Symphony No 9. The business was previously owned by Rank Hovis.