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May 9, 2006

UK: Kraft looking to expand amid UB rumours

Kraft Foods has confirmed that it is looking for expansion opportunities in the global biscuit market amid rumours that the US food company has partnered with Premier Foods and a Dutch private equity group in order to launch a bid for the UK’s largest biscuit manufacturer United Biscuits.

Kraft Foods has confirmed that it is looking for expansion opportunities in the global biscuit market amid rumours that the US food company has partnered with Premier Foods and a Dutch private equity group in order to launch a bid for the UK’s largest biscuit manufacturer United Biscuits.

Kraft already ownes one-quarter of UB, a spokesperson for the company told just-food. “Kraft does indeed own a 25% stake in United Biscuits, acquired along with the Nabisco business back in 2000,” Julia Westcott said.

Market commentators have suggested that Kraft is looking to take direct control of UB businesses in southern Europe, which manufacture Oreo’s under license. Dutch private equity firm NPM Partners is expected to snap up UB’s northern European operations, leaving the UK businesses to Premier Foods.

Kraft chief executive, Roger Deromedi, has confirmed that the company hopes to expand its presence in the international biscuit sector but resisted giving further details. “We’ve been very clear that biscuits is one of our global cores and we want to compete in that business on a more global basis,” Deromedi said. “How we enter those businesses I won’t give specifics on. But we will use both organic and acquisitions to do so.”

UB has declined to comment on the possibility of a takeover, but a spokesperson did tell just-food that the company has undertaken a strategic business review, which is yet to be concluded. “Goldman Sachs is conducting a review of all UB businesses. The review is looking at all areas of the business and all possibilities, including sale or floatation,” UB said. “The review isn’t yet completed and no timetable has been set for completion.”

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