ConAgra ups Ralcorp offer

City A.M. Reporter
CONAGRA Foods has raised its bid for Ralcorp Holdings to around $4.9bn (£2.96bn) in cash as it looks to attract price-conscious shoppers with lower-priced foods – but may have to dig even deeper to close a deal.

Shares of Ralcorp – which mainly makes foods that stores then brand as their own – rose to $90, above the sweetened offer price, indicating investors may expect a higher bid.

“ConAgra was very wise to recognise the significant value in Ralcorp and there would be plenty left on the table at $100 [per Ralcorp share],” said Janney Capital Markets analyst Jonathan Feeney.

Some analysts have said Ralcorp may attract interest from private equity firms that could expand the company's cash-flow generation.