McCormick to Make Third Bid For Premier Foods
US food flavouring giant, McCormick is set to make a third bid for one of the UK’s largest food producers, Premier Foods.
Premier Foods, which owns household food brands in the UK such as Bisto and Oxo gravy and Mr Kipling cakes, has been the subject of two bids already from McCormick. The bids of 52 pence a share and then a 60 pence a share offer on March 14th, have both been rejected on the grounds of undervaluing Premier Foods.
However, despite recently agreeing a 17.27% stake sale to Japanese noodle giant Nissin, it is believed that a third bid from McCormick may well be accepted by the majority of the Premier Foods board. This is despite Standard Life, who own a 7% stake in Premier Foods, still considering even a third bid to be undervaluing Premier Foods.
Premier Foods Debt
Premier Foods has suffered from expanding too quickly and incurred large debts in the process. Having sold off its leading bread brand – Hovis, Premier Foods was forced to implement a £1.1bn refinancing package, which included a £353m rights issue.
Premier shares soared 50% on Wednesday after the news broke of an expected third bid by McCormick who own the Schwartz spices. Since then Premier stock fell by more than 10% on Thursday on the Nissin stake announcement and then recouped nearly all their losses after McCormick said it may well be prepared to pay more for Premier Foods.
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