A CHILLED food business employing hundreds of North-East workers has been sold to a US firm in a £150m deal.

The Daniels Group, parent company of County Durham firm International Cuisine, was yesterday sold to New York based natural food producer the Hain Celestial Group.

Hain, which has paid Daniels owner Singapore Airport Te (Sats) £151m for the business as well as a potential £13m over the next two years, said it believed the deal would create a "powerhouse" in the sector.

International Cuisine, based in Consett, makes a million chilled meals a week for UK supermarkets and convenience stores and employs around 700 staff.

It is one of the biggest facilities run by Leeds headquartered Daniels, which is responsible for brands including New Covent Garden soup, Johnson's Juice and Farmhouse Fare desserts.

It employs around 2,000 people across six sites in the UK and generated sales of around £175m last year

Following the deal Daniels chief executive Rob Burnett will become chief executive of Hain Celestial UK.

Hain, which was founded in 1993, presently employs 600 staff across its two UK facilities, at Luton and Fakenham, Norfolk, so the deal will potentially quadruple its British interests.

Its UK business is responsible for brands including the Linda McCartney food range and Daily Bread sandwiches and snacks, which hold a Royal Warrant from the Queen.

Yesterday Hain Celestial chief executive Irwin D. Simon said: "The strategic acquisition of Daniels extends Hain Celestial's presence into one of the fastest-growing healthy food segments in the UK with a solid leadership position and platform for the growth of our combined operations.

"We will also look to expand the distribution of certain Daniels brands throughout the rest of Europe utilizing our European-based sales organization."

Mr Simon added: "We think there is a lot of opportunity to bring Daniels expertise in fresh soups and desserts to the United States for consumers looking for fresh, natural soups instead of canned soups."

Chris Stott, a partner with KPMG, which advised Sats on the deal, said: "It is about building a strong European food and drink business. This gives Hain critical mass in the UK."

He added: "It's exciting to play a role in a great local deal, especially one that helps Northern companies to demonstrate why they are an attractive acquisition in a challenged sector.

"Rising raw material costs and falling consumer spend are beating up many businesses in the food and drink sector but the strength of these companies brands and their robust cost base management, including commodity pricing issues, were critical to this deal."

Since it was established in 1988 with 14 staff, International Cuisine has become one of the biggest employers in Derwentside.