Irish food group Greencore today (24 January) admitted it is weighing up its options over its next move in the battle for Northern Foods after the UK manufacturer accepted a rival bid from poultry and fish group Boparan Holdings.
On Friday evening, Boparan made a GBP342m (US$547.2m) offer for Northern after weeks of speculation and ahead of a Takeover Panel deadline that expired at 7pm on Friday.
The bid, worth 73p a share, was backed by Northern’s board, which had spent over two months supporting a move to merge with Greencore. In November, Northern and Greencore announced plans to combine their businesses and create Essenta Foods, a business that would generate annual sales of GBP1.7bn.
In a statement this morning, Greencore said a combination with Northern still represented a “compelling opportunity for value creation” for investors of both companies.
However, it added: “The board recognises the importance attached by the Northern Foods board to the certainty of cash value in their decision to change their recommendation.
“Given this latest development, the board of Greencore will now consider its options and as part of this process intends to seek the views of both Greencore and Northern Foods shareholders. A further announcement will be made in due course,” the firm said.
According to a report in the Financial Times, Greencore is expected to return with a revised offer, which is likely to contain a cash element. It was, however, unlikely to return with a full cash bid, the publication said.
Boparan, run by food tycoon Ranjit Boparan, owns the Harry Ramsden’s restaurant chain, as well as 2 Sisters Food Group, a major supplier of chicken to Tesco and Marks and Spencer.