Princes Ltd.

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Princes Ltd.

6th Floor Royal Liver Building
Pier Head
Liverpool
United Kingdom
Telephone: +44 0151 236 9282
Fax: +44 0151 255 1440
Web site: http://www.princes.co.uk

Wholly Owned Subsidiary of Mitsubishi Corporation
Incorporated: 1880 as Simpson, Roberts
Employees: 3,525
Sales: £750 million ($1.2 billion) (2004)
NAIC: 424410 General Line Grocery Merchant Wholesalers

Princes Ltd. is the United Kingdom's leading importer of canned foods products, and one of its major processed foods and soft drinks producers. The company has been associated with the United Kingdom's canned fish market for more than 125 years, and remains one of the country's top two canned tuna brands. Princes also has expanded its brand name to include a range of food and cooking oils, as well as processed foods including canned meats and other ready-to-eat meals, ready-made sandwiches, and sauces. Princes has been extending its brand portfolio in the 2000s, adding brands such as Napolina Italia Foods, Shippams, Mazola, Cookeen, and Crisp N' Dry. In 2005, the company entered the ambient ready-to-eat meal segment with the launch of the Quick Eat brand. Since the 1990s, Princes also has been present in the soft drinks market, with a full range of juices, carbonated beverages, and mineral water marketed under the Princes, Jucee, Twist n' Squeeze, and, since 2005, Aqua Pura brands. In addition to its U.K. manufacturing operations, Princes operates production facilities in The Netherlands and on the island of Mauritius. The company has set itself a target of doubling its sales, from 2004's £750 million, through the second half of the 2000s. As part of that strategy, the company expects to expand its operations further onto the European continent. In addition to its subsidiary in The Netherlands, the company controls the Vier Diamanten canned tuna brand, the largest in the Austrian market. Princes has been wholly owned by Japan's Mitsubishi Corporation since the late 1980s.

Canned Fish Importer in the 1880s

Princes' origins stretched back to the late 19th century and the formation of Simpson, Roberts. The company, formed as a partnership in 1880, specialized in importing canned fish to the United Kingdom, especially salmon and other fish from Canada. Operating from headquarters in Liverpool, the company eventually launched its own line of canned fish under the Princes brand. By 1900, the partnership had formed a dedicated subsidiary for its canned food products, Princes Pure Foods Ltd.

Simpson, Roberts remained focused on its import business into the mid-20th century. By 1946, however, the company had begun its first move into manufacturing, setting up a processing and production facility in Southport. The company also established a production facility in The Netherlands, in 1960. Nonetheless, the great majority of the company's operations remained focused on its fish imports, and the company was essentially recognized as a commodities business. By the late 1950s, the company also had gone public, although the Dickinson family, who had been among the original partners, remained as the company's leadership; indeed, the group's chairman, W.T. Dickinson, served with the company for 80 years until his death in 1962.

The transition toward a branded food products group began in the early 1960s. In 1962, the company changed its name, adopting its popular Princes brand name as its corporate identity. Through the 1960s, the company successfully positioned its line of Princes-branded canned fish as one of the United Kingdom's leading brands.

The company's effort came in the midst of a dramatic change in the U.K. grocery sector. Once dominated by small, locally owned grocer's shops, supplied by a myriad of small production companies, the grocery market had begun to shift toward the rapidly developing supermarket model. The supermarket format quickly established itself as a dominant force in the grocery sector. By the late 1960s, a small number of large, regionally and nationally operated supermarket chains had begun to transform the U.K. food industry in general. Many smaller grocers disappeared, while others were forced to consolidate.

The arrival of supermarkets placed food producers and importers under a new and unprecedented pressure. The consolidation of the sector and the concentration of consumer spending was coupled with the tendency of supermarket groups to focus on a narrower range of branded products. Producers were forced to compete for limited store shelf space.

This new fact of the grocery industry sparked a wave of consolidation among British food companies in an effort to gain the national scale to supply the largest supermarket groups. Princes, with its popular brand name, became a fixture on supermarket shelves. Nonetheless, by the late 1960s, the company became caught up in the industry consolidation. In 1968, Bibby & Co., which produced paper products as well as foods, including its Trex line of fats and vegetable oils, launched a takeover offer for Princes. The company initially rejected the offer as too low. Yet Princes' management held just 10 percent of the group's shares. When Bibby raised its offer, the company had no choice but to accept, and Princes ceased to be an independent company.

Bibby's expansion effort floundered, however, into the early 1970s. The company's problems were especially attributed to the Princes acquisition, which, still chiefly a commodities business, had not generated the hoped-for synergies with Bibby's other operations. In 1973, Bibby decided to restructure, and sold off its foods division, including Princes Foods and its Trex fats and oils business, to Italy's Buitoni. That family-owned company, based in Italy, had been making its own drive to expand internationally, and the Princes acquisition provided Buitoni with a solid entrance into the United Kingdom.

Princes grew strongly as part of Princes Buitoni. The company expanded its canned goods business, adding new products such as imported canned vegetables and canned corned beef and other meats. By the end of the decade, the company held the U.K. market leadership in some 11 different canned goods categories. From sales of £33 million in 1980, the Princes division grew to turnover of £200 million at the end of the decade. The Princes brand alone represented some 93 percent of these sales.

Building a Brand Family in the 2000s

Nestle acquired Princes Buitoni in 1988, then sold off the Princes Food division to Mitsubishi the following year. Backed by one of the world's largest corporations, Princes now began to diversify its operations, expanding its range of brands, as well as its production capacity. On the one hand, Princes enjoyed continued independence of operation under Mitsubishi. On the other, the company was able to take advantage not only of Mitsubishi's financial clout, but also of its extensive, worldwide presence.

Princes' first product extension came in 1991, with the purchase of G. Barraclough Limited. That company added soft drinks production and distribution to Princes' operations, including the Gee-Bee brand of carbonated beverages and "squashes." The company continued to develop its soft drinks wing, buying Cima Foods Limited in 1993. That purchase extended the company's operations to the fruit juice and fruit drinks category.

Beverages remained the company's primary acquisition target through the end of the decade. In 1997, Princes bought Barber Springdale and its line of juices, squashes, and carbonated beverages. The company then bought the Juices Division from Waterford in 1998.

As the new decade approached, however, Princes' acquisition interest turned toward developing its food categories. In 1999, the company bought up rival Oxbridge Foods Ltd., a producer of canned foods, including vegetables, fruits, and fish. That year the company also made an unsuccessful attempt to buy up Shippams Ltd., which produced fish pastes, canned chicken, and pate, and which had been in operation since the late 18th century. However, in 2001 Princes made a successful bid to acquire Beta Foods, finally gaining control of the Shippams operation.

By then, Princes had expanded its canned fish production capacity, buying up a cannery on the island of Mauritius in 1999. The company took a break from its foods expansion to add to its beverage division again in 2000, buying Wells Soft Drinks. In that year, as well, the company completed its acquisition of oils group Leon Frenkel, after acquiring 50 percent of that business in 1998. In 2001, after the Shippams acquisition, the company bought up Italian foods group Napolina Italia Limited.

Company Perspectives:

Our Responsibilities: Princes recognises that, as a major international manufacturer and supplier, the company has a responsibility towards the environment, its employees and the communities in which it operates. Princes constantly strives to ensure that its business activities provide sustained environmental, social and economic benefits in the countries in which it operates. The company complies fully with the labour, health and safety and employment laws of the respective countries in which it operates. The same compliance is expected from all Princes' suppliers, which are regularly audited by the company.

In the early 2000s, Princes began developing goals for expansion onto the European mainland. The company began producing for the private-label market, expanding in The Netherlands, Sweden, and Spain. The company also formed a partnership with Italian canned tomato producer AR Industrie Alimentarie, forming the Russo joint venture in 2000. In 2002, in keeping with its growth goals, the company restructured its operations. As part of this process, the company created three new divisions: Princes Foods Trading and Manufacturing, which focused on its U.K.-based businesses; Princes Foods International, which included its Netherlands, Mauritius, and Italian holdings, focused on developing the group's European operations; and Princes Soft Drinks, which included the group's beverage business in the United Kingdom and Europe. The company hoped the restructuring would achieve its goal of doubling in size into the second half of the 2000s.

A new extension to the group's brand family came in 2002, when Princes gained the franchise for Virgin Drinks, including the popular Virgin Cola, launched in the early 1990s. Under Princes, Virgin redeveloped its recipe in order to differentiate itself from competitors. In 2003, the company further extended its beverage line with the acquisition of Dairy Crest's chilled fruit juice operations. A year later, the company entered the bottled mineral water market, a rapidly expanding beverage segment in the United Kingdom, with the purchase of Well Well Well Ltd. and its Aqua Pura brand.

In addition to its acquisition drive, Princes launched an in-house effort to extend its operations into new product categories. In 2000, for example, the company launched its own branded line of ambient dips. The company also began to target the ready-to-eat market, introducing its own prepared canned meals. Included in this effort was a partnership with Slimming World, and the launch of 12 tuna-based, Slimming World-branded ready-to-eat products. In 2005, the company launched a new line of ready-to-eat ambient meals. Originally developed for Marks & Spencer, the popularity of the line led the company to launch the line under its own Quick Eat label.

With sales of £750 million—and a target to reach £1.5 billion during the decade—Princes continued seeking expansion opportunities. In 2005, the company made a new acquisition, buying up the licenses to a range of oil brands, including Flora, Mazola, Cookeen, and the olive oil brand Olivio. After 125 years, Princes remained a leading name in the U.K. foods industry.

Principal Subsidiaries

Stretton Hills Mineral Water Company; Eden Valley Mineral Water Company; Princes Foods B.V. (Netherlands); Napolina Italia Ltd.; Princes Tuna (Mauritius) Ltd.

Principal Divisions

International Trading and Manufacturing; Soft Drinks; Foods Manufacturing.

Principal Competitors

John West Foods Ltd.; Thai Union Frozen Products plc; Bumble Bee Seafoods LLC; StarKist Foods, Inc.

Key Dates:

1880:: The Simpson, Roberts partnership is established in Liverpool to begin importing canned fish.
1900:: After developing the Princes brand, the company establishes the Princes Pure Foods subsidiary.
1962:: The company adopts the new name of Princes Foods Ltd.
1968:: The company is acquired by Bibby & Co.
1973:: Bibby sells the foods division, including Princes and the oils operations, to Buitoni of Italy.
1988:: Nestle acquires Princes Buitoni.
1989:: Mitsubishi acquires the Princes foods division from Nestle.
1991:: Princes makes its first acquisition, entering the beverage market through the purchase of G. Barraclough.
1993:: The fruit juice group Cima Foods Ltd. is acquired.
1997:: Carbonated beverage company Barber Springdale is acquired.
1999:: Rival Oxbridge Foods Ltd. is acquired.
2000:: A joint venture is formed with Italy's AR Industrie Alimentari; Wells Soft Drinks is acquired; the Leon Frenkel Ltd. oils group is acquired.
2001:: Beta Foods and its Shippams subsidiary are acquired.
2002:: The company restructures operations ahead of a European expansion drive.
2003:: Dairy Crest's chilled juice division is acquired.
2004:: The company enters the bottled mineral water market with the purchase of Well Well Well Ltd. and its Aqua Pura brand.
2005:: The company acquires the licenses to the Mazola, Flora, Cookeen, Spry Crisp 'n' Dry, and Olivio oil brands.