Premier Foods pushing for improved US offer

Mon, 04 Apr 2016 | BUSINESS SALE

The food manufacturer behind famous British brands such as Mr Kipling, Bisto and Ambrosia has said an offer from US spice and sauce maker McCormick is too low, but it is open to negotiations.

Premier Foods is in the process of talks with its state-side suitor, but has said that McCormick’s offer of 65p per share in cash, which values the business at around £1.5 billion, “continues to undervalue Premier [Foods] and its prospects.”

Nevertheless, increased pressure from shareholders has forced the board of directors at Premier Foods to go back to the negotiations table in the hope that “McCormick will increase its offer price to a recommendable level”.

According to Premier Foods, McCormick is open to further discussions and that a revised proposal is on the cards in the near future. Premier Foods went so far as to say: “The board has informed McCormick that it will be expected to provide an improved proposal following these meetings.”

News of the proposed takeover sent shares in the British food manufacturer skyrocketing by more than 70 per cent, with each share rising nearly 7 per cent to 60.4p in late March 2016.

Two of Premier Foods’ biggest shareholders — Standard Life and Paulson & Co — have urged the board to further its talks with McComick. The British company had already rejected to previous bids of 52p and 60p per share earlier last month.

Premier Foods found itself in distress when it accumulated large amounts of debt after purchasing a series of other food brands before the financial crisis of 2007-08. Since then, it has subsequently sold Hovis, Hartley’s and other well-known brands, as well as carrying out a £1.1 billion refinancing.

In late March 2016, Nissin became Premier Foods’ largest shareholder and is expected to take a seat on the British food manufacturer’s board.

A statement from McCormick said: “McCormick continues to believe that, with its 127-year heritage, it would be an outstanding custodian for the Premier Foods brands and, with the strength of its balance sheet, can provide benefits for Premier Foods, its pensioners, creditors and other stakeholders, which Premier Foods’ current capital structure cannot deliver with or without the proposed cooperation with Nissin Foods.”

For more information, see other food manufacturers and brands for sale.


Share this article



Latest Businesses for Sale

Bakery
North East, UK

Specialises in the provision of a range of premium pastries, hot and cold snacks, speciality cakes and freshly baked breads for major supermarkets and local businesses across the North East. Highly skilled and experienced workforce whose professional...

Asking Price: Offers Invited
Turnover: £1,900,000

LEASEHOLD


Off-Licence & Convenience
Ibstock, Leicestershire, UK Wide

The business has been operated by the current vendors for over 25 years and this is the first time the site has been advertised on the open market for over 100 years. The business has built up an enviable reputation throughout the area for quality an...

Asking Price: £450,000
Turnover: £751,000

FREEHOLD


MOT Test Centre/Vehicle Repair Business
Staffordshire, UK Wide

Well-established and very popular MOT station and vehicle repair business Staffordshire. The business was established by our client in 2005 and is only now being offered to the market due to our clients’ desire for change of direction and to concentr...

Asking Price: £450,000
Turnover: £319,000

FREEHOLD



View more businesses for sale

News Search

Latest News

 
15
 
Aug
 

Payroll and HR companies acquired by software group | BUSINESS SALE

IRIS Software Group has finalised the agreement of intent to...

 
14
 
Aug
 

NG Bailey’s acquisition of Freedom boosts its turnover by 16 per cent | BUSINESS SALE

Engineering and services group NG Bailey’s strategic a...

 
13
 
Aug
 

Forensic science equipment supplier completes MBO | MBO/MBI

A private equity firm has backed the management buyout of a ...

Free guide: 10 Biggest Buyer Mistakes

Sign up to receive our acquisition alert emails to get your FREE guide

Email


Related News

 
19
 
Jul
 

Food giant to potentially sell parts of its business | DIVISION SALE

Facing mounting debt and unpopular management, Premier Foods...

 
25
 
Jul
 

Sale of Premier Foods bread section 'still a possibility' | BUSINESS SALE

A sale of Premier Foods' bread companies is still on th...

 
06
 
Mar
 

Horse meat scandal prompts local business acquisitions | BUSINESS SALE

The horse meat scandal surrounding beef products stocked by ...

Want access to the latest businesses for sale?

Business Sale Report is your complete solution to finding great acquisition opportunities.

Join today to receive:

  • Comprehensive range of businesses for sale
  • Make direct contact with business sellers or their intermediaries
  • Access to all UK administrations, liquidations and winding-up petitions
  • Daily email alerts for the latest businesses for sale & distressed notifications
  • Business Sale Report publication posted to you every month
  • Advertise your acquisition requirements on our "business wanted" section

All this and much more, including the latest M&A news and exclusive resources