Not spicy enough: Premier Foods rejects third takeover offer by US seasonings giant McCormick
Premier Foods has rebuffed a third takeover approach from US spices giant McCormick, saying the revised 65p per share offer still undervalues the company.
The company, however, said it is prepared for meetings to take place in order to discuss "value drivers, a review of material pensions documentation, current trading and material contracts, and so to establish whether McCormick will increase its offer price to a recommendable level".
Premier has also informed McCormick that it will be expected to provide an improved proposal following these meetings, adding that there can be no certainty that any offer will be made.
McCormick, which owns seasoning brands such as Schwartz, announced this morning that it had raised its offer to 65p per share, valuing the firm at £1.5bn, up from the 60p per share bid it tabled last week. It first offered 52p per share back in February.
The company's chief executive Lawrence Kurzius said yesterday it was drawn to Premier's "iconic brands", which would complement its own food business and help expand its presence in the UK.
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But Premier has so far rejected all approaches by the American suitor, reiterating that it still undervalued the company and its prospects. On the same day that Premier rejected MCormick's initial offer last week it agreed "cooperation agreement” with Japanese instant noodle-maker Nissin.
Nissin then proceeded to buy a 17.27 per cent stake in Premier Foods from private equity shareholder Warburg Pincus last Thursday.
The move angered some of its top shareholders including Standard Life Investments and Paulson & Co, who criticised Premier Foods' handling of the takeover approach and putting the interests of certain shareholders ahead of others.
Premier's shares have risen by seven per cent today to 60.54p on the news of the revised offer.