Thu, 19 Jul 2018 | DIVISION SALE
Facing mounting debt and unpopular management, Premier Foods is considering the sale of parts of its business.
Its chairman Keith Hamill said: “I don’t think anything is off the table,” noting that Premier Foods would only consider an “exceptional price” for its assets. This would force the company to pay off its debt and generate investment for its future.
Household brands like Batchelors, Cup a Soup, Angel Delight and Bisto are under consideration for sale. It is expected that their sales will raise £200 million.
The company’s second largest shareholders, Hong Kong-based hedge fund Oasis Management, have been urging Premier Foods to make haste on its investment plans, even threatening to oust Gavin Darby, the firm’s chief executive, from the company at the upcoming AGM.
Darby, however, has said that such publicity and commotion may boost interest amongst buyers.
He said: “The benefit of this process is there can’t be a single investment banker or food company that is not aware that if the price is right the board would look at an asset sale.”
With only a market value of £390 million, Premier Foods faces £496 million in net debt and £4.5 billion in pension liabilities. Its debt is estimated to be more than three times the value of the company’s underlying profits.
Despite this, the company is predicted to meet profit expectations after having demonstrated a 1.7 per cent increase in sales in the quarter finishing on 30 June. Owing to a successful advertising campaign, its Mr Kipling cake subsidiary experienced a 14 per cent sales rise.
Hamill described the business as a “hardworking company” and stated that “we know that we need to find ways to accelerate the turnaround”.
Darby concluded: “Of course I would like the share price to by higher. I am convinced it will be if we continue doing the things we are doing, and I have invested personally in that expectation.”
For more news stories about business divisions for sale click here. For all our business listings, click here.
Available on the market for an acquirer seeking a superbly appointed West Yorkshire timber and garden product merchant. This wholesale operation was established in 2004.
This is an exciting opportunity to acquire this long-established Animal feed and supplies business, which has been successfully operated by our clients since 2017.
Established over a century ago, the company is a family-run butchery with deep roots in the local community. Based in North Wales, the company has built its reputation on providing high-quality meat products and exceptional customer service.
Please choose your settings for this site below. For more information please read our Cookie Policy
These cookies are necessary for our website to function properly and provide you with access to all features.
These are analytics cookies that help us to improve the way our website works.
These are used to improve the functional performance of the website and make it easier for you to use.