Greencore ends takeover talks

 
City A.M. Reporter
IRISH food group Greencore said yesterday talks over a possible takeover had ended due in part to turmoil in global debt and equity markets, sending its shares down over 10 per cent.

Greencore, one of the biggest sandwich and ready meal suppliers to Britain, said in October it had received a potential takeover approach.

“Given the board’s unanimous view on the strong underlying value of Greencore and the current dislocation in global equity and debt capital markets, both parties have agreed to end discussions,” it said yesterday.

Analysts say prepared food players are being squeezed by a highly consolidated retail sector, putting pressure on them to merge in a bid to cut costs.

Greencore in July described the British consumer food market as “challenging and volatile.” It is due to publish its annual financial results today.

Greencore makes prepared meals under the Weight Watchers brand and supplies sandwiches to supermarkets, garage forecourts and airlines.

Earlier in the year talks fell apart that could have led to Greencore buying Northern Foods, after the companies failed to reach an agreement that Greencore said would offer strong returns to its shareholders.

And in July it had paid £113m for British rival Uniq, a company that sells desserts, sandwiches and salads to retailers across the UK.

The company said it expected to generate annual cost savings of at least £10m by cutting duplicated back office and supply chain costs.