BOPARAN’S takeover of Northern Foods was all but sealed yesterday, as rival Greencore walked away from making a counter bid.
Ranjit Singh Boparan, who gatecrashed Greencore’s planned merger with Northern last November, bought Northern shares in the open market yesterday while the share price lingered below his 73p offer price, taking the chicken producer’s share up to the maximum 24.99 per cent.
His BH Holdings vehicle owned or had approval from 48.25 per cent of Northern Foods’ shares at 1pm yesterday, ahead of a second acceptance cut-off and well before the 60-day takeover deadline.
Hedge fund managers GAM International and Crispin Odey are believed to be among those who sold out to Boparan yesterday.
Several sources said yesterday that Greencore, which had teamed up with an unnamed private equity player in a bid to better Boparan’s bid, failed to agree with Northern’s pension trustees about tackling its gaping deficit, which runs up to £500m under some measurements.
BOPARAN’S bankers were cautious yesterday after the path was cleared for their client’s £342m takeover of Northern Foods.
"We hope that this is the end, and that people will now accept the offer,” was one banker’s response to Greencore’s departure from the race, though the news represents the end of an ambitious gatecrashing of what was seen by many in the City as a done deal.
Leading the charge for Boparan was Rothschild managing director Avi Goldberg, an M&A veteran with 25 years’ experience in the City.
Goldberg is mooted to be the banker behind Duke Street’s expected £215m purchase of noodle chain Wagamama, announced yesterday.
Goldman Sachs was added to Boparan’s advisory team mid-way through the negotiations thanks to a quiet word between Goldberg and Goldman’s UK co-head Michael Sherwood, insiders say.
TIME LINE | NORTHERN FOODS
Northern Foods and Greencore announce plans for a £510m all-paper merger to create a new firm named Essenta.
Northern reveals an initial approach from Boparan, who starts to build his stake from six per cent to around 11 per cent.
Two hours after a Takeover Panel deadline, Boparan offers 73p per share, or £342m, which the Northern board accepts.
Greencore hints that it will come back with a new, cash-sweetened offer, sending Northern shares up 17.5 per cent.
Greencore, after trying to mount a bid with an unnamed private equity partner, decides to walk away, leaving Boparan in the clear.