Associated British Foods (ABF), the owner of Kingsmill, has announced plans to acquire rival Hovis in a deal that would create the UK’s largest packaged bread brand. The proposed merger comes as both companies struggle with declining demand and intensifying competition in Britain’s bread market.
ABF, which also owns retail chain Primark and food brands including Ryvita and Twinings, said it intends to streamline operations and cut costs in order to return the two loss-making bread businesses to profitability.
The Unite union, which represents workers at both Kingsmill and Hovis, issued a swift warning that it would resist any threat to staff. “We will not tolerate attacks on jobs, pay or conditions,” the union said in a statement, raising the prospect of potential industrial tensions should ABF pursue aggressive restructuring, BBC reported.
The UK’s bread sector has faced important shifts in consumer habits. Once a staple of British households, packaged loaves such as Hovis and Kingsmill have seen sales stagnate, with demand increasingly shifting toward artisanal and speciality breads such as sourdough and ciabatta.
At present, family-owned Warburtons remains the dominant player in the market. The proposed tie-up between Kingsmill and Hovis would be subject to review from the UK’s Competition and Markets Authority (CMA), which will assess whether the merger would harm consumer choice or distort competition.
Industry analysts say that while combining two established brands could offer scale advantages, success will depend on whether ABF can adapt to changing tastes. “The challenge is not just cutting costs—it’s convincing shoppers that these heritage names still matter in a market where premium and speciality products are driving growth,” one analyst noted.
If approved, the deal could reshape the market of the UK’s bread industry, consolidating two household names into a single giant at a time of profound change in what Britons choose to put on their tables.
