Premier Foods could be targeted lock, stock and barrel by China's acquisitive Bright Foods, after its purchase of Weetabix, City analysts suggested.
Premier, which owns brands such as Hovis and Oxo, saw shares rise 10% on the news that it had found a buyer for its £34M turnover vinegar and sour pickles business, including the Sarson’s brand. It sold the operations to Japanese vinegars specialist Mizkan for £41M cash.
While this is a trade sale, analysts suggested that, with £290M more assets on the table to sell, Premier might see many of its businesses going to companies in emerging markets in Asia, which are staking out territory in the UK.
Martin Deboo analyst from Investec, told FoodManufacture.co.uk: “The recent Bright foods Weetabix deal was rather different as that was about Chinese players with low costs of funding staking out territory, rather than seeking ‘hard’ synergies. However, Bright could be a potential buyer for the whole of Premier Foods.”