Backwerk mother Valora swallows Harry Bread’s Back-Factory

Back-Factory branch in Schwerin

Harry Bread’s daughter is to be sold.

Dusseldorf Sandwiches on the way to work have been less popular since the lockdown. In the city centers in particular, many providers have suffered, including the Back-Factory snack chain. The Swiss Valora Group is now taking over the subsidiary of the Harry Brot bakery. The company announced this on Tuesday.

Valora is taking over all of the more than 80 branches of Back-Factory. The takeover is to take place on November 1st, provided that the Federal Cartel Office gives its approval. The parties have agreed not to disclose the modalities.

Valora wants to make the purchase “from existing financial resources”. The Swiss employ around 15,000 people and most recently had external sales of 2.2 billion Swiss francs.

The Backwerk snack chain is already part of Valora, which operates the K Kiosk kiosk chain and Press & Books station bookshops, among other things. Backwerk had put pressure on the German baker’s guild with its self-service concept.

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Backwerk was taken over in 2017 for around 190 million euros. Valora has increasingly expanded the self-service bakery into a bakery restaurateur. The pretzel chain Ditsch also belongs to the listed Swiss.

“Back-Factory complements our German store portfolio of the Backwerk and Ditsch brands with currently around 500 sales outlets with complementary locations, and we are continuing to move into inner-city locations,” said Thomas Eisele, head of Valora Food Service. With the takeover of the Back-Factory, Valora has risen to the top five of the top-selling system restaurateurs in Germany. The pandemic has thus accelerated consolidation in the industry.

Major baker Harry Brot opened the first bakery factory in Bielefeld in 2002. The self-service bakery thus developed into a snack provider. In 2019, the Back-Factory generated external sales of around 80 million euros and an Ebitda of over five million euros. Most branches are franchised.

Harry Brot recently suffered a loss of sales

In the lockdown, the business with sandwiches and snacks was worse. As a result, Harry Bread’s sales fell by around two percent in 2020. Harry Brot from Schenefeld near Hamburg has more than 4,500 employees and a turnover of over one billion euros. According to market researcher Nielsen, the family company with 333 years of history is the German market leader for bread.

“We at Harry see our core competencies in the baking and distribution of bread and rolls, less so in system catering,” said Frank Kleiner, Managing Director at Harry Brot. That is why Back-Factory is being sold to a “sustainable company”. This should pave the way for the long-term further development of the chain.

More: From baker to snacker – how baked goods are repositioning themselves