Boparan Greencore bid would ‘amaze’ analysts

Analysts believe that Boparan is unlikely to make a move for the firm having recently acquired Northern Foods in a £342M deal in March.

On top of the price of the business, it is thought Boparan Holdings also inherited a £200M pension liability and a further £200M in debt, which makes an offer for Greencore out of the question, experts have said.

Darren Shirley, analyst at Shore Capital, told Food Manufacture.co.uk: “I would be amazed if he [Boparan] was interested. Boparan Holdings paid a lot of money for Northern Foods and his experience is in the own-label arena. After inheriting a lot of brands, he will be focussing on extracting the value from that business.”​

Another analyst told Food Manufacture.co.uk: “I would be amazed if he was a potential contender, in fact I’d say there is absolutely no possibility of it​.”

Low margins​

He agreed that Boparan Holdings is likely to have its hands full integrating the Northern takeover and reaffirmed his belief that a private equity player is the most likely suitor.

Last week, speculation amongst experts was rife that a private equity firm was the most realistic candidate as UK or overseas food businesses are unlikely to be interested in acquiring the firm. As an own-label business, it produced low margins and would not fit a brand strategy, analysts said.

Following news of the mystery suitor last week, Damian McNeela, analyst at Panmure Gordon, told Food Manufacture.co.uk: “It’s difficult to see any local food player gearing up to take Greencore out. That would lead to a private equity or possibly management offer. Greencore has a US presence, so it could be US private equity.​”

Management buy out​

Although private equity appears to be the most likely prospect, analysts are also not ruling out the possibility of a management buy out for the firm.

Clive Black, analyst at Shore Capital told Food Manufacture.co.uk: “We cannot rule out that management may be involved in any change of ownership of the business in tandem perhaps with private equity​".

Shirley agreed, although the current speculation lies with private equity, “there is a possibility of management involvement​”.