Baby food company Plum Baby has been acquired by Darwin Private Equity for £10 million, generating an exit for its original investors.

Baby food company Plum Baby has been acquired by Darwin Private Equity for £10 million, generating an exit for its original investors.

Venture capital trusts (VCTs) managed by Beringea, Octopus and Foresight are all realising their investments through the sale.

On completion of the deal Plum Baby’s founder, former chef Sue Willis, will stay on as creative director, while CEO Patrick Cairns will leave the business to be replaced by Paul Kaye, who has previously worked with HJ Heinz UK and Masterfoods.

Darwin is currently investing from its I LP fund, which has commitments totaling £217 million from investors including Goldman Sachs and LGT Capital Partners.

Jonathan Kaye, partner of Darwin Private Equity,says: ‘Plum is a very strong brand. We believe Plum has significant growth potential and we plan to invest heavily in the business to build upon its market position.’

Alex Macpherson, who heads Octopus Investments’ venture team, says the firm first invested in Plum Baby in 2007, when Cairns joined the business as CEO. He adds, ‘We are pleased with the sale – it delivered a good return for our investors and us.’

Plum was advised on the sale by Spayne Lindsay, and Darwin was advised by PricewaterhouseCoopers, who were also the reporting accountants.

Hampshire-based Plum was founded in 2006 and sells its products through food retailers including Tesco and Waitrose. The company is forecasting sales of £15 million this year.