Premier Foods calls on shareholders to approve £200M spreads sale
The proposed sale to the US multi-national was announced on August 23 and is conditional on shareholder approval.
Following approval by the Financial Services Authority on August 28, Premier Foods notified shareholders of a general meeting, at which they will be asked to consider and authorise the proposed sale of the spreads business in Histon, Cambridgeshire.
If shareholders are in agreement and an agreed pre-sale reorganisation is completed, the disposal is expected to complete on October 27.
Debt mountain
Once the disposal has been completed, Premier Foods will receive £170M in cash and £30M in Hain Celestial shares. The cash will be used to repay some of Premier’s £1.27bn debt.
On announcing the sale, Premier boss Michael Clarke told FoodManufacture.co.uk: “This divestment is a major step forward in our strategy to simplify the business and focus on our Power Brands.
“Following completion of this sale, we will have raised around £275M of the £330M disposal proceeds that we committed to achieving by June 2014. This will represent a 22% reduction in our net debt since the half year.”
