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VIP Petfoods joint managing director Tony Quinn will double his operations after splashing out more than $75 million to acquire the financially-troubled Bush’s International.
The deal, expected to be finalised on August 24, will open up new international markets for VIP.
“We were the logical purchasers to buy it – 45 per cent of Bush’s is export so while that wasn’t a key driver, it’s an interesting dimension for us. What we want to do with their dry dog food is to inject fresh meat. We want to be known as the people who put fresh meat into dry dog food,” says Quinn, an ardent motorsport enthusiast.
VIP Petfoods is focused on chilled dog food and the expansion into dry food is the next logical step says Quinn, who also expects to double employees to more than 600, with potential to double revenue as well.
Quinn cites the Sydney and Dubbo-based dry pet food company as ‘mind boggling’ after it was found to be losing five cents a can on some products.
“They spent a fortune, they were confused by private equity deals, their eyes were off the ball, they forgot what a margin was,” he says.
Bush’s went into receivership and Quinn cites 70 interested parties being whittled down to three, before VIP laid the best offer on the table.
“One thing is buying it, but when you take into account debtors and working capital, at the end of the day the cost of the business is between $75 million and $80 million,” he says.
“Bush’s at its peak was doing $200 million a year but they’re not doing that now – we’re going to have a surgical look at the business and fix it. We’re determined to make this work.”
Last financial year VIP group had revenue from its chilled food products of around $120 million.
Quinn’s plan for Bush’s is to change its brand to Australian Pet Brands, which will produce goods for other brands in the market as it has in the past, for larger players like Nestle and Masterfoods. It’s motto is ‘a brand’s best friend’.
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