Maggie Beer Holdings sells Paris Creek Farms for huge loss

The gourmet food company inspired by celebrity chef Maggie Beer has sold a struggling dairy business, but only after accepting a huge multimillion-dollar loss.

Maggie Beer at Adelaide Airport’s Qantas business lounge. Picture: Duncan Evans

Maggie Beer Holdings, the ASX-listed company inspired by the South Australian celebrity chef, has finally found a buyer for its struggling dairy business Paris Creek Farms, but only after accepting a hefty multimillion-dollar loss.

Victorian food manufacturer and distributor Katoomba Global Foods has agreed to purchase the Adelaide Hills-based dairy products maker for $500,000, less than eight years after Maggie Beer Holdings (MBH) paid $34m for the business.

Paris Creek has been on and off the chopping block since 2022 as part of an ongoing strategic review of MBH, which also owns the Maggie Beer Products brand and Hampers and Gifts Australia, a company that sends out gift hampers to corporate clients and households.

Announcing the sale of Paris Creek, MBH said it was part of a move to sell off non-core assets and “simplify the operating structure of MBH”.

“This is a positive step forward for the group, allowing us to sharpen our strategic focus on our core premium brands, particularly Maggie Beer Products,” Maggie Beer Products and Paris Creek Farms general manager Hamish McLeay said.

Paris Creek Farms founder Ulli Spranz at the Meadows property.

“This divestment enables us to simplify our operations and better allocate resources to the areas with the greatest potential for growth. We’re pleased to see Paris Creek Farms continue under the ownership of KG Foods, with local jobs and brand presence maintained.”

Paris Creek is based at Meadows in the Adelaide Hills and focuses on organic and biodynamic products, including yoghurt, cheese, milk and butter.

Its products have one a string of awards and are sold at Woolworths and other supermarkets, but it has struggled under MBH’s watch, due in part to a pullback in consumer spending, especially on some premium and gourmet foods.

MBH said the sale, which is expected to be completed within 10 business days, would deliver annual cashflow savings for the group of about $2.2m.

KG Foods will also take over all of Paris Creek’s liabilities, including staff entitlements.

With roots in Malaysia, KG Foods manufactures and distributes a wide range of international food brands including Al Wadi, The Rice Company, The Spice People, Maggi and Pangkarra.

Shares in MBH have fallen 90 per cent since 2022 and are currently trading at a near record low of 5.7c.

Maggie Beer is no longer involved in the day-to-day operations of MBH but remains on the board and also owns shares in the company.

Originally published as Maggie Beer Holdings sells Paris Creek Farms for huge loss