Hovis owner Premier Foods has begun a secret hunt for an outside investor to help reverse the fortunes of its floundering bread division, reports Sky News' City editor Mark Kleinman.
Premier Foods has approached a number of private equity groups over the sale of a stake in its bread unit.
Sky understands that the chief executive of Premier Foods, Gavin Darby, has asked Ondra Partners, a mergers and acquisitions advisory firm, to head up the search for an outside investor.
Along with Hovis, Premier Foods also owns Mother's Pride and Nimble. 99 per cent of UK households bought its brands last year.
However, shares in the country's largest food producer plummeted 16 per cent at the end of October, after a set of results that it blamed on the summer heatwave. Underlying sales fell by 3.2 per cent to £283m in the three months to 30 September, compared with a 0.9 per cent fall in the first half of this year.
Over the past few years, the company has been selling non-core brands to help reduce debt. It's also been investing in its eight so-called power brands, which include Bisto and Ambrosia. These brands saw sales growth slow to two per cent, down from four per cent in the first half.