December 27, 2010

Boparan considers taking over Northern Foods

Boparan Holdings, the UK food business behind poultry processor, 2 Sisters Food Group and fish-and-chip shop chain, Harry Ramsden's, has confirmed it is mulling a takeover bid for Northern Foods.

Northern, a leading own-label supplier to UK multiples and owner of Fox's biscuits and Goodfella's pizza, is intending to merge with Ireland's Greencore but its shares soared on December 22 upon confirmation of Boparan Holdings' interest in the business.

Boparan Holdings' owner, food tycoon, Ranjit Boparan, has been amassing a stake in Northern since its plans to merge with Greencore were announced last month. Boparan's stake stands at 6.6% of Northern and the media said the entrepreneur was planning to launch a GBP300 million (US$462 million) hostile bid for the business.

In response to the speculation, Northern confirmed that Boparan Holdings had asked for information regarding the business under City takeover regulations. Northern, however, insisted that the merger with Greencore would offer substantial benefits to the business and said its board unanimously supported teaming up with the Irish group.

Boparan Holdings has confirmed it is at a preliminary stage in evaluating a possible cash offer for Northern Foods.

Boparan said, "However, there can be no certainty at this stage as to whether this will result in an offer being made for Northern Foods. Further announcements will be made as and when appropriate."