“The boards of both Boparan and Northern Foods urge shareholders to accept the recommended cash offer by Boparan before the next closing date of the offer on March 16 2011,” the businessman’s firm BH Holdings told the stock exchange.
Game, set and match
Credit Suisse analyst Charlie Mills told FoodManufacture.co.uk that today's acquisition effectively meant "game, set and match" for Boparan, and said he was unsurprised by Greencore's "inevtiable" announcement yesterday that it does not intend to rival Boparan’s all-cash bid.
Northern’s share price fell this morning following Greencore’s announcement yesterday , and stood at 72.5p/share as we went to press, which allowed 2 Sisters Food Group owner Boparan to swoop and acquire 13.61% (63,794,202) of Northern’s existing ordinary share capital today at 73p/share, from "various shareholders" including 28,794,202 from Odey Asset Management.
Including today’s purchase, BH Holdings said Boparan “holds or has agreed to acquire” 24.99% (117,118,761) of Northern’s shares, and revealed that – as of 1pm on Monday – he had received valid acceptances from Northern shareholders for 109,005,676 shares, around 23.25% of the firm's issued capital.
Boparan has thus acquired or agreed to acquire, or received valid acceptances in regard to 226,124,343 Northern Foods shares, 48.25% of its issued shares.
Corporate dreams, ripped at the seams…
Annoucing the abandonment of its Northern pursuit, Irish food group Greencore said yesterday: “For some time the board of Greencore has believed both in the considerable strategic merits of consolidation in the UK convenience food sector and in the strong logic of a combination between Greencore and Northern Foods.”
Greencore said it had worked with an unnamed third-party (believed to be a private equity firm) over several weeks, in order to agree a “simultaneous sale of certain of the Northern Foods branded businesses” to match Boparan’s £342m all-cash offer.
Shore Capital analysts Clive Black and Darren Shirley said of Greencore’s announcement: “The sense of disappointment…is palpable and understandably so; Greencore showed astute timing and considerable strategic nous in its proposed merger with Northern and so the creation of Essenta Foods.”
But despite missing out on Northern, the analysts noted that Greencore’s ambition to have a “stronger platform in the UK prepared foods market is a sound one, and whilst Northern may have been the dream corporate ‘romance’ there are plenty more fish in the sea”.