UK: Trade, private equity groups eye Inter Link
Trade and private equity groups have declared an interest in Inter Link Foods, the chairman of the UK bakery group has told just-food.
Jeremy Hamer said today (18 May) that the company has received a number of approaches although he remained tight-lipped on the nature of the interest.
Nevertheless, unnamed parties in the food industry and from the private equity are believed to have expressed an interest in buying at least part of Inter Link, while a range of alternative funding arrangements has also been put to the company.
Earlier this month, Inter Link started tentative takeover talks with McCambridge, which has increased its stake in the company in recent weeks to 9%. Hamer said McCambridge's interest is as yet the "most solid" interest in Inter Link.
Inter Link has issued two profit warnings so far this year and Hamer said the company is set to announce that it has lost "a lot of money" in the year to 5 May.
The company has said it would cut GBP2m (US$3.9m) in costs from the business and has identified more savings under a review headed by recently installed chief executive Ian Croxford, Hamer said.
"Ian has huge experience in the operations area and has dived into the factories and got everyone thinking about what can be done," Hamer said. "There are no sacred cows."
Some 120 jobs have already been lost at Inter Link, which operates from 12 bakery sites in the UK, and another bakery in Poland, and more could follow, Hamer warned.
Inter Link, which makes Soreen malt loaves and private label cakes for supermarkets, has seen sales hit as consumers switch to more premium products, as well as those giving "added claims", Hamer said.
"We've seen a move to premium, more indulgent products and Inter Link has missed out on that," Hamer said. "We've also seen a move towards products with added claims in terms of health and so on, and Inter Link hasn't yet got involved in that."
Hamer added that the company's presence in the own-label part of the market has been "tough" with the category seeing fierce price competition.
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