Greencore has announced plans to buy rival chilled foods group Uniq.
Leading shareholders in Greencore have already backed the 96p a share deal, which values Uniq at £113m. To fund the swoop, the Irish group is issuing €80.2m (£70.5m) of equity through a fully underwritten rights issue and is increasing its debt facility.
It will transfer its stock market listing to London and denominate its results in sterling while retaining its headquarters in Ireland. Analysts said the changes could take a year to complete.
“The proposed acquisition of Uniq delivers demonstrable further scale in two key categories – food to go and chilled desserts – and is underpinned by substantial synergies," said Greencore chief executive Patrick Coveney (pictured).
“Furthermore, it broadens Greencore’s commercial footprint and it is perfectly aligned to our strategy.”
The tie-up got an early thumbs-up from analysts, who had previously warned that Greencore could become a takeover target following the collapse of its planned merger with Northern Foods.
While dealing with Uniq’s troubled Minsterley desserts site will be a key challenge for Greencore following the takeover, Shore Capital analyst Clive Black said the increased business with Marks & Spencer was welcome.
“This transaction should allow Greencore to move on and, with Uniq digested, look forward to further ‘buy and build’ opportunities down the line,” he said.
Read The Grocer's exclusive interview with Uniq chief executive Geoff Eaton here.
Profits slip as Greencore ponders life without Northern (24 May 2011)
Greencore ‘must act fast or it will become a target’ (21 March 2011)
Greencore concedes defeat in Northern takeover tussle (9 March 2011)