Ahead of its crucial AGM vote today which will determine the future of its CEO Gavin Darby, the UK’s Premier Foods has suggested it is open to selling assets.

News agency Reuters reports Darby and chairman Keith Hamill said Premier had recently undertaken strategic reviews that included exploring the possibility of selling assets. One review, begun in the spring, was accelerated due to activist investor agitation, while another was undertaken earlier this year, it said.

Hong Kong-based Investor Oasis Management – the Mr Kipling cakes and Oxo stock cube maker’s second largest shareholder – is calling on Darby to be removed from his position in a vote at the annual general meeting, claiming his five year period in charge has seen Premier drift into a “zombie-like state” burdened by heavy debt and low growth.

It is supported by fellow investor Paulson & Co. but not, it is understood, by Premier’s largest shareholder Nissin Foods.

Darby has said he is confident of retaining his position and he has received the backing of trustees of the company’s three largest pension funds.

Oasis has also called on Premier to sell its Batchelors brand and Reuters reports Darby and Hamill told reporters late last night (17 July) the battle with Oasis has had some benefits, such as publicising the fact that assets may be up for sale.

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“Nothing is off the table,” the news agency reports Hamill as saying.

Nissin was linked with a takeover of Batchelors earlier this year.

Today, announcing a trading update for Premier’s first quarter, for the 13 week period ending 30 June, the company said its expectations for progress in its key priorities in the full year remains unchanged, and as previously communicated, weighted to the second half of the year. 

Premier said it is committed to continuing its strategy of improving performance and reducing net debt by GBP25m (US$32.8m) per year, while working in parallel to “identify other strategic opportunities to accelerate the company’s turnaround to create value for shareholders”.

Sales for the period were up 1.7% on a year-on-year basis, with Mr Kipling being the star performer on the back of a brand relaunch with sales up 14%.

Jefferies analyst Martin Deboo said: “Q1 has delivered a further quarter of growth and the best sustained sequence since 2012. The offsetting caution is that growth in Q1 was delivered against a materially weaker prior year comp, with group sales growth in Q1 FY18 of negative 3.1%, relative to negative 1% in the preceding two quarters, and branded grocery sales growth of negative 7.9%.

“There were, however, mitigating factors, flagged at Q4, in the form of: one, international sales growth of only 4% at Q1 relative to 34% at Q4 & 20% in the prior Q1, reflecting pipeline fill in Australia; two, an earlier Easter in 2018 that would have pulled sales out of Q1 and back into Q4; three, UK weather.”