London, Feb 19, 2026, 09:33 GMT — Regular session
- Kitwave shares slipped 1% after the group warned in its quarterly update that profitability came in below expectations.
- Softer demand from hospitality, a weaker sales mix, and elevated costs are weighing on the company, it said.
- Traders are watching the takeover timeline, with attention turning to shareholder meetings set for late February.
Kitwave Group PLC shares dropped Thursday, after the company reported that quarterly profits came in below what it had hoped for internally. The UK wholesaler also flagged that margin pressures are likely to stick around through the year. By 09:15 GMT, Kitwave traded at 293 pence, slipping from Wednesday’s 296 pence close.
This warning lands at a time when Kitwave has had the feel of a deal stock for weeks. A cautious update like this is exactly what tends to stretch the spread between a takeover bid and where the shares actually trade, recommended offer or not.
Kitwave plans to present its 295 pence-per-share cash offer to shareholders on Feb. 26, when both court and general meetings are set, the scheme document publication announcement showed. The timeline points to March 12 as the anticipated effective date, pending approvals and a court sanction hearing on March 10.
Kitwave reported Thursday that revenue for the three months ending Jan. 31 matched last year’s figure, though the company took a hit from weaker-than-expected hospitality demand, which altered its sales mix unfavorably. Gross margin slipped as a result. Costs climbed, too, with the opening of a South West depot piling on additional expenses alongside rising overheads—driven in part by higher National Insurance contributions and the national minimum wage.
The company reported that its “adjusted operating profit”—a metric it defines, excluding certain items considered one-offs—fell “materially behind” what the board had expected. No specific number was disclosed.
The shares traded at 293 pence, just shy of the offer at 295. That tight gap points to lingering confidence the deal will go through—though markets clearly aren’t calling it a certainty yet.
Decagon Asset Management LLP has reported a 5.616% stake in Kitwave, according to a filing out Wednesday. The position comes via contracts for difference, or CFDs—these are derivatives settled in cash rather than by actual share delivery. Decagon crossed that threshold on Feb. 17, the TR-1 notification confirmed.
Kitwave runs a network of 37 depots delivering wholesale goods across the UK, supplying both retail and foodservice clients, its website shows.
Back in January, OEP—private equity sponsor of BidCo—framed its move as a growth play in UK grocery and foodservice wholesale. “We are thrilled” about the recommended offer for what it called a “high-quality national distribution platform,” OEP partner Ori Birnboim said then. Investegate
But Thursday’s update drove home the risk for investors eyeing more than just the deal price: product mix can shift fast, and both labor and operating expenses are climbing. If hospitality demand remains sluggish or cost inflation accelerates, underlying earnings could take a hit.
Right now, timing is taking precedence over projections. Investors are eyeing any comments before the Feb. 26 meetings, gauging whether things remain set for the March 10 sanction hearing and the anticipated March 12 effective date.
