Northern Foods disappointed in Burton's auction

Fox’s Biscuits owner Northern Foods said today it was out of the auction for Burton’s Foods – the firm behind Wagon Wheels and Maryland Cookies.

Private equity group Hicks, Muse, Tate and Furst is currently considering its options for Burton’s, which employs 3,000 people and has four UK bakeries.

Northern is believed to have been up against a group of venture capital bidders - including Duke Street Capital and 3i – in an auction process expected to fetch more than £200m (€298m).

In a brief statement today, Northern said it had been told that it was no longer in the auction.

That is likely to fuel speculation that Northern could consider selling its Fox’s business to the winner of the auction. Northern had hoped to create a business of sufficient scale to compete with industry leader United Biscuits.

Hicks acquired Burton’s from Associated British Foods in 2000 for £130m (€194m). Since then it has undergone a restructuring, while its sweets business was sold this year. It also manufactures Jammie Dodgers and makes chocolate biscuits under licence from Cadbury.

The company’s four bakeries are at Edinburgh, Blackpool, Moreton and Llantarnam, Gwent. It also has a distribution centre at Knowsley and a head office at St Albans.

Northern is now focused on core brands such as Fox’s and Goodfella’s Pizzas after selling off a number of under-performing operations last month. It supplies products to all of the major retailers.