Greencore confirms takeover bid

SHARES in Greencore jumped by more than 20%, at one point yesterday, on news that the company has received a possible takeover approach.

The convenience food giant said via a stock exchange statement, that it has received an approach, “which may or may not lead to an offer for the company”.

The company added that discussions “are at a preliminary stage and there can be no certainty whether any offer will be forthcoming”, adding that a further announcement will be made “when appropriate”.

While group representatives were declining to comment any further, yesterday, speculation was mounting that the potential bid was emanating from the private equity sector.

Greencore has been no stranger to consolidation news this year. In March, it launched an ultimately failed takeover approach for Northern Foods in Britain, before finally hammering out a deal — in July — to boost its British business, with the €125 million takeover of the convenience food manufacturer Uniq.

Uniq recently de-listed from the AIM market in London, paving the way for the formal completion of its takeover by Greencore.

The purchase of Uniq — which also recently reported a significant return to profit for the first half of 2011 — also significantly boosts Greencore’s business in Britain, making it one of the chief food suppliers to Marks and Spencer.

The first half of this year saw Uniq record a pre-tax profit of £69.2m (just over €79m); a turnaround from a pre-tax loss of £11.2m for the same period last year.

At the time of the initial announcement of the Uniq takeover deal, Greencore’s chief executive Patrick Coveney said that it fitted with the Irish company’s long-held strategy of strengthening its position in Britain, expanding its category portfolio and broadening its customer base.

Uniq is also expanding the overall size of Greencore; by being subsumed into Greencore’s British operations.

On a group-level, meanwhile, Greencore has talked about plans to switch its reporting currency to sterling and, in time, de-list from the ISEQ in Dublin and seek a listing in London; albeit still retaining its Dublin headquarters.

This news boosted Greencore’s Dublin-based share performance.

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