Debt ‘strangled’ Typhoo Tea, claims Supreme’s Sandy Chadha

BELOVED tea brand Typhoo Tea has been acquired by an Asian businessman who blamed excessive debt under the previous ownership for the company’s financial struggles.

Fast-moving consumer goods seller Supreme, led by Sandy Chadha, bought the loss-making Typhoo Tea out of administration on Monday (2) for £10.2 million.

Founded in 1903 by a Birmingham grocer John Sumner Jr, the tea brand had been struggling with mounting losses and declining sales.

The 120-year-old tea brand had fallen into administration in November due to declining sales and mounting debt pressures. A break-in at its Merseyside factory in August 2023 exacerbated the company's cost pressures, and the site was subsequently shuttered.

Typhoo reported revenues of £25.3m for the year to September 30, 2023, down from £33.7m during the same period a year earlier, according to the most recent accounts. Pre-tax losses widened to £38m in the 12-month period from £8.5m the previous year.

The firm has not reported a profit since 2017 and accumulated pre-tax losses exceeding £100m.

Speaking to the Times, Chadha highlighted the brand's unsustainable financial model. "This is a business that's not made any money, so how do you support £25 million-plus debt?" he questioned, pointing to the company's inability to generate sufficient cash flow.

The acquisition is part of Supreme's pivot away from vaping ahead of anticipated government regulations on disposable e-cigarettes. The company aims to diversify its portfolio, targeting non-vape sales to represent half of its total revenue.

Chadha was optimistic about preserving Typhoo’s legacy. "It's such an iconic brand," he said, revealing he'd received numerous messages from well-wishers relieved the tea company would continue operating.

The rescue plan involves expansion strategies. Supreme said it wants to increase Typhoo's distribution from 8,000 to 20,000 outlets and is exploring potential product innovations, particularly in the growing iced tea market.

"The tea market is declining, but the iced tea market is increasing significantly," Chadha noted, hinting at potential future product developments.

According to him, the company has immediate plans to address the brand's challenges.

Chadha said the focus will be on product quality, pricing, distribution, and marketing.

He also said he will personally meet Typhoo's 30 staff members to discuss their future roles.

“I’m going to go and speak to every single staff member, either on Zoom or meet them personally, and we’re going to sit down and we’re going to work out what the right strategy is," he was quoted as saying.

Typhoo's suffered significant setbacks, notably a disruptive site break-in that caused substantial damage and contributed to its financial woes.

The brand, previously owned by Zetland Capital since 2021, had been attempting a turnaround through staff reductions and supply chain restructuring.

Supreme was founded in 1975 by GS Chadha and now deals with approximately 40,000 outlets across the UK. It has a track record of managing diverse product ranges.

The Manchester-based firm manufactures and supplies a variety of everyday items to supermarkets, specialist retailers and direct to consumers. These include Duracell and Energizer batteries, SCI-MX (sports nutrition), Sealions (nutritional supplements), Perfectly Clear drinks, and Black & Decker lighting. Supreme also supplies several brands of vapes, including its own-manufactured 88Vape.

Sandy bought the business from his father in 2003 and the company floated on Aim, London’s junior market, three years ago. The company's acquisition of Typhoo represents another step in its strategic growth.

Chadha said he will "give my best shot to make this brand and the heritage a success."

He was ranked 52nd in Eastern Eye’s Asian Rich List 2025, with an estimated wealth of £350m.