Daily Mail

Sweet sale leaves bad taste

- Alex Brummer CITY EDITOR

Deal announceme­nts are meant to explain rather than confuse. Citigate, communicat­ions adviser to Hotel Chocolat, outdid itself with an email to the media in which the founder of the confection­ery company, angus Thirlwell, mysterious­ly rambles on about Queen Bee and Beekeeper.

Maybe he and the Hotel Chocolat board are so disconcert­ed at selling out to Mars, makers of such wonderfull­y healthy sweets as M&M’s, Snickers and Skittles, that it thought it best to wrap itself in the code names loved by investment bankers.

The reality is that Hotel Chocolat, having built a reputation for producing ethical, quality chocolate from its own farms on St lucia, has sold out to Mars for £534m.

It is too good a deal to resist, delivering a 169.8pc premium to Hotel Chocolat’s depleted price. as investor Richard Bernstein, of Crystal amber, observes, minuscule valuations for UK small caps have made them ‘sitting ducks’.

as a private, hobby investor I ought to be overjoyed at this get-out-of-jail card. Thirlwell can’t contain his delight in praising the ‘skills, expertise and capabiliti­es’ of Mars. He will be joining the ranks of the UK’s super-rich with a payout of £140m. The plan is to stay on as chief executive (we may have heard that before) and to reinvest in the chocolatie­r. Mars is pledging to keep open Hotel Chocolat’s factory in Huntingdon and preserve 3,000 jobs.

The longer haul is a different matter. Mars boasts an annual turnover of £39bn and a reputation for smart marketing. But the controllin­g family are secretive, so tracking Hotel Chocolat’s future may prove tricky.

Britain has been terrific at creating organic, ethical brands with potential global reach in a greener world. But UK investors, founders or their offspring are hopeless at seeing the project through. Green & Black’s was swallowed by Cadbury, which was bought by Kraft and is now part of Mondelez. anita Roddick’s Body Shop was snapped up by l’Oréal, sold to Natura and was this week passed to private equity outfit aurelius Group for £210m.

Big internatio­nal branded goods firms find it hard to manage enterprise­s with a social purpose. even when the deals work commercial­ly, outcomes can be very mixed. Unilever’s last chief executive, alan Jope, found himself with a serious problem when the ‘woke’ Ben & Jerry’s ethical board in Vermont sought to ban ice-cream sales in West Bank settlement­s in the Middle east. Unilever, to its credit, declined to budge.

The great irony about the fate of Hotel Chocolat, Green & Black’s, Cadbury et al is that in a nation of chocolate lovers (Brits are the main consumers after the US), there is no home-grown brand listed in london.

This clearly is not a case for referral under the National Security and Investment act. But we dispose of eclectic, sustainabl­e British firms far too easily.

Wind repairs

FEW geographie­s are blessed with such a promising environmen­t for offshore wind power as the British Isles.

Yet someone, somewhere in Whitehall managed to get their sums all wrong at the last offshore auction. energy Security Secretary

Claire Coutinho (who knew we even had one) has now lifted the guaranteed price offered by 66pc to £73 per megawatt hour at the March 2024 sell-off.

The improved price is meant to make sure that higher borrowing and supply chain costs are fully covered. The uplift produced applause from Greenpeace and apoplexy from consumer advocate Net Zero Watch.

Contracts-for- difference pricing structures give some certainty to bidders. Whether any of this will make any difference to Sweden’s Vattenfall, which in the summer pulled back from its Norfolk project, is unknowable. There are no free lunches. Subsidies eventually push up green levies on domestic bills.

Expensive error

a GlOBal slowdown in luxury spending has already arrived in Britain, with Burberry issuing an effective profits warning.

That’s not a great start for the collection designer Daniel lee launched in September.

Blame for the setback is placed at the door of Chinese shoppers. Instead of buying at home, as in the aftermath of Covid-19, they are splashing the cash overseas. london finds itself at a disadvanta­ge to Paris and Milan because foreign tourists cannot reclaim VaT. all the more reason for Jeremy Hunt to end the farce in next week’s autumn Statement.

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