Yoghurt star sold to mystery buyer
A yoghurt company that won a top entrepreneurship prize two years ago has been sold to a mystery buyer while an associated company in Britain has been closed.
Piako Gourmet Yoghurt, whose founders won a $300,000 prize in the Auckland University business school's Entrepreneurs' Challenge, changed hands in November, resulting in 12 redundancies.
The deal, for a confidential sum, involves Piako's intellectual property and licensing rights only, because the yoghurt's manufacture and distribution has been outsourced to Fonterra since April 2011.
Piako co-founder Shaun Jacka said the product had been selling well and the decision to outsource to Fonterra was due to demand growing beyond his family-run factory's ability to cope.
"It's been a phenomenal success in New Zealand and we were never quite set up to handle that success," he said.
Jacka said he was bound by a confidentiality agreement from revealing who the brand's new owners were.
"At some stage it will become common knowledge."
Before its sale, Piako was jointly owned by two companies held by Jacka family members and associates - Kiwi Yoghurt Company and Tasman Dairy Producers.
Fonterra said it was not the buyer but that the brand had been something of a star performer.
It has doubled its share of the gourmet yoghurt segment from 7 to 14 per cent under the dairy giant's guidance.
Meanwhile, a British company associated with Piako and Jacka has been closed by its New Zealand backers.
Little Melton Gourmet Yogurt - whose clients included Harrods, British Airways and Tesco - folded in November, making nine staff redundant.
It was set up in 2010 to make fresh yoghurt in the market rather than exporting from New Zealand. Although a separate entity, Little Melton shared some investors and directors in common with Piako, and Jacka repeatedly referred to Little Melton as putting Piako on British shelves.
Investors lost about $2 million, including a factory fitout in Norfolk, sources said. Little Melton's former manager, Mark Collins, expressed disappointment the British yoghurt firm had been "effectively closed up overnight".
Competition in the British market was fierce but he believed the company's potential had been cut short.
"The product is just fantastic and everybody says that," Collins said.
"Once we closed it up, we had the biggest supermarket chain in the UK contact us saying: how can we go about getting some more product?
"It's got to be a five-year plan with any type of business like this and I don't think that the New Zealand guys took that into account."
Collins also said one of Little Melton's directors had tried unsuccessfully to buy out the company. But Little Melton director Rob Latton said the director had never actually made an offer.