Shares in Associated British Foods fell 20.5p to close on 841p yesterday, despite the food to clothing manufacturer revealing plans to merge its Ryvita business with cereal business Jordans.

Associated British Foods said some cost savings would be achieved through the merger and both brands would be developed through new sales channels such as convenience and impulse, as well as internationally.

Ryvita and Jordans both have three manufacturing sites, but there would be no factory closures, it added.

Analysts agreed the merger would benefit both brands. "I would suspect that Jordans has the higher growth potential than Ryvita at this moment in time," Darren Shirley, an analyst at Shore Capital told the Independent. “Ryvita will probably do with a bit of pepping up and the Jordans' team giving it a bit more TLC than it would probably get in the ABF grocery division."