NORTHERN Foods has agreed to be taken over by businessman Ranjit Boparan in a deal worth 73p per share in cash, valuing the maker of Goodfella's Pizza and Fox's biscuits at £342m.
In a statement, Northern Foods it withdrew support for the previously-proposed takeover by Ireland's Greencore Group and instead recommended shareholders accept the offer from Boparan’s wholly-owned subsidiary BH Acquisitions.
The offer was tabled at the eleventh hour after the Takeover Panel granted Boparan a last minute, two hour extension to his 5pm deadline today.
”This attractive cash offer provides shareholders with an immediate premium to the value of Northern Foods within Essenta Foods, the proposed merger with Greencore we announced in November 2010,” said Northern Foods chairman Anthony Hobson.
“Today’s bid from Boparan is a compelling opportunity for our shareholders to realise a cash exit, and as such the Board of Northern Foods will be unanimously recommending that Northern Foods Shareholders accept Boparan's offer.”
Northern Foods’ shares closed at 63p, up four per cent, valuing the business at just under £300m.
Reports earlier in the day said Boparan, who also owns the Harry Ramsden's fish and chips chain, had reached an agreement with trustees of Northern Foods’ pension scheme, clearing the way for him to bid for the company.
Sources said the deal would see over £15m paid into the scheme each year under a takeover by Boparan.
“The combined group will be one of Britain’s major food suppliers with a turnover of more than £2bn,” said Boparan.
Boparan's original approach came after Northern Foods had agreed to merge with Ireland's Greencore to create a new company called Essenta Foods.
Greencore had offered to pay 0.4479 new shares per Northern Foods share, equivalent to around 50p per share at current prices and valuing Northern Foods at about £236m.