Kitwave - wakefield site
The acquisition will be incorporated into Kitwave’s existing Foodservice division / Image source: Kitwave
  • Kitwave shares up 41% year-to-date
  • Cash and banking facilities funded purchase
  • Total Foodservice has around 4,000 product lines

Shares in Kitwave (KITW:AIM) were up 4.5% to a new all-time high of 372p in morning trading as the food and drink wholesaler announced it was buying Total Foodservice, a leading independent food wholesaler in the North of England for £21 million.

The purchase has been made in cash and funded by the group’s current banking facilities.

Ben Maxted, Kitwave CEO said: ‘Total Foodservice is a well-established business in the catering industry, and we look forward to welcoming its team to Kitwave and integrating the business into our Foodservice division.

‘This acquisition is in line with Kitwave’s growth strategy, and we will continue to seek to identify further opportunities in the UK’s highly fragmented wholesale market to deliver further value to the group and its shareholders.’


Total Foodservice was founded 130 years ago and delivers wholesale catering supplies of around 4,000 product lines including chilled, frozen, and ambient food, non-food, and cleaning products.

The company has several depots around the UK including Clitheroe, Lancashire and Huddersfield, Yorkshire.

Total Foodservice’s customers include licensed trade and restaurants, coffee shops and sandwich bars, schools and universities and the care industry across the North of England.

The acquisition will be incorporated into Kitwave’s existing Foodservice division which currently comprises the trading operations of David Miller Frozen Foods, M. J. Baker Foodservice, Westcountry Food Holdings and H.B. Clark & Co. (Successors).


Kitwave’s purchase comes after the small cap food and drink wholesaler reported a positive set of results for the year ending 31 October 2023.

Why Kitwave can keep on delivering growth and income

On 27 February, the company reported a 40% increase in pre-tax profit to £24.9 million compared to £17.8 million in the same year ago period.

Revenue increased by 20% to £602.2 million.


Mark Photiades analyst at Canaccord Genuity said in a research note: ‘This latest acquisition is Kitwave’s fourteenth acquisition since 2011 and fourth since the IPO (initial public offering) in May 2021, following the acquisition of M.J. Baker in February 2022, Westcountry in December 2022 and the small bolt-on of Wilds of Oldham in November 2023. The acquisition is highly consistent with Kitwave’s successful buy-and-build growth strategy in what remains a largely fragmented wholesale market.

‘The shares have traded strongly across 2024. On revised estimates, Kitwave trades on 11.9x October 2024 (estimated) PER falling to 11.1x October 2025 (estimated) with an October 2024 (estimated)/October 2025 dividend yield of 3.2%/3.9% and (free cash flow) FCF yield of 7.6%/9.3%.

‘We continue to believe this valuation is too low given the group's strong cash generation, robust balance sheet and considerable further consolidation opportunities available.’


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Issue Date: 28 Mar 2024