Premier Foods takeover bid latest, as row deepens
Last week the Mr Kipling manufacturer rejected a takeover bid from McCormick because it significantly undervalued the business, said Premier.
It also revealed that Japanese instant noodle manufacturer Nissan Foods had acquired a 17.27% shareholding in the business.
On Thursday (March 24) Premier said in a statement: “ … should McCormick, or any other bona fide potenial offeror, come forward with an improved proposal that better reflects the board’s assessment of the company’s underlying value over the longer term, the board would give such offer careful consideration and evaluate its merits …”.
‘An improved proposal’
Such a bid would be reviewed with regard to the best interests of shareholders, employees and other stakeholders, it said.
Over the past weekend media reports claimed two big Premier shareholders had criticised the manufacturer’s management for not giving sufficient consideration to the bid from McCormick.
Key shareholders Standard Life and Paulson & Co were named in the report published by The Sunday Times. Together the companies were thought to hold about 14% of Premier’s shares.
Premier Foods ceo Gavin Darby believed there was plenty of time for a rival bid to challenge McCormick, according to a report in The Sunday Telegraph.
“The Premier board feel very confident that rejecting [McCormick’s offer of] 60p was a good decision,” Darby told the newspaper.
‘Highly attractive cash offer’
McCormick expressed disappointment that Premier Foods’s board had allegedly denied the manufacturer’s shareholders the opportunity to consider the US firm’s “highly attractive cash offer”.
The spice firm said in a statement: “Despite McCormick’s efforts to enter into a meaningful dialogue with Premier Foods on several occasions, the board of Premier Foods has been unwilling to engage constructively with McCormick.”
Meanwhile, Premier has complained about “a number of inaccurate numbers reported in the media, specifically around Premier Foods’s debt and pension deficit, which have overstated the true position”.
The manufacturer highlighted that its most recent half year figures (published in November) confirmed that Premier's net debt had fallen to £585M and its IAS19 pension deficit had reduced to £33M.
“The last figure is particularly significant since it is down from an IAS19 deficit of £603M at the end of 2013 (a reduction of almost 95%), while the debt has fallen from a high point of more than £1.7bn at the end of 2010,” said a spokeswoman for Premier Foods.
