The UK’s Big Food Group has received a preliminary approach from Iceland’s Baugur Group and certain other investment partners regarding a possible offer for the company.
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Big Food Group said the approach, for all of the issued and to be issued share capital of the company at 110p in cash per share, is preliminary and there are a number of pre-conditions, including due diligence, which need to be satisfied before any formal offer can be made. The company also said there can be no certainty at this stage that an offer for the company will be forthcoming.
The board has agreed to allow Baugur, which already owns 22% of Big Food Group, to conduct due diligence on the company in order to explore further whether a formal offer can be put forward.
“This statement has been made with the approval of Baugur and certain other investment partners, who have reserved the right to make an offer at a lower price with the agreement of the board of BFG,” the company said.
Moving on to current trading, Big Food Group said poor weather conditions since July have impacted its performance.
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By GlobalData“The environment has also continued to be challenging in the light of consolidation in the grocery market and increasing price competition, which is expected to continue,” the company said.
Big Food Group said like-for-like sales for the ten-week period to 10 September 2004 were down 3.2% from a year earlier. Like-for-like sales at the company’s Iceland frozen food chain in the same period were down 3.8%. However, the company said its new format Iceland stores continued to perform well, with 32 refits completed over the ten weeks, bringing the total to 218.
