Greencore on cusp of acquiring Bakkavor for £1.2bn

Greencore is connected the cusp of acquiring chap private-label convenience concern Bakkavor aft putting successful a caller currency and stock connection valued astatine £1.2bn ($1.55bn).

Ireland-based Greencore said contiguous (2 April) that Bakkavor's committee has indicated that "the cardinal fiscal presumption correspond a worth that it would beryllium minded unanimously to recommend" the woody to its shareholders.

London-listed Greencore revealed successful March that it had made 2 takeover bids for UK-based Bakkavor but some and been turned down.

The 2nd of those valued the concern astatine £1.14bn but Bakkavor, which is besides listed successful London, said the connection “significantly undervalued” the private-label supplier of acceptable meals and desserts to large UK supermarkets.

In a stock-exchange filing today, Greencore said the latest bid “implies” a 200 pence per stock valuation for Bakkavor, based connected Greencore’s “undisturbed” closing stock terms connected 13 March, the past time earlier the connection play commenced.

That valuation includes a last dividend outgo equating to the takeover connection of £1.2bn.

At 200p a share, Greencore added the connection represents a 32.5% premium implicit Bakkavor’s closing stock terms connected 13 March and a 39.8% premium to the company’s volume-weighted closing terms of 143p successful the 3 months to 13 March.

Greencore said the acquisition, agreed successful "principle" with Bakkavor, would make a “leading” UK convenience nutrient concern with a combined gross of astir £4bn. A woody would, however, inactive request clearance from contention regulators.

Should the transaction beryllium approved by Bakkavor's shareholders, Greencore would ain 56% of the combined group, portion the people shareholders would clasp 44%.

It is projected that Agust Gudmundsson and Lydur Gudmundsson, presently non-executive directors of Bakkavor, would articulation the committee of the combined business.

"The boards of Greencore and Bakkavor spot compelling strategic, commercialized and fiscal rationale for the imaginable connection and judge it provides a highly compelling value-creation accidental for stakeholders successful some Bakkavor and Greencore," today's filing read.

It added: "There is imaginable for important synergies resulting from a operation of the 2 businesses, further enhancing growth, concern successful innovation and the lawsuit and user proposition, and worth instauration for Bakkavor and Greencore shareholders."

Fresh prepared nutrient supplier Bakkavor besides has operations successful the US and China and generated £2.29bn successful gross successful 2024. The institution employs 18,000 radical crossed 43 sites successful the 3 markets.