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City sources have tipped Tyrrells to return to private equity hands for the third time in a cut-price deal after new owner Hershey’s signalled its desire to sell off the upmarket crisps brand.
Weekend reports suggested confectionery giant Hershey’s, which inherited Tyrrells after buying its US owner Amplify Snack Brands in December, is poised to start an auction for the brand after just 18 months in US hands.
Amplify bought Tyrrells from Bahrain-based Investcorp for £300m in the summer of 2016, but the brand has suffered in its home UK market ever since and Hershey’s is set to cut its losses on the deal.
The Grocer understands Pringles owner Kellogg’s has run the sliderule over Tyrrells in recent months. However, the cereal giant appears to have walked away from a firm bid, opening up the auction to an array of participants.
One City source tipped Tyrrells to end up in private equity hands for the third time rather than a sale to another trade buyer. “The most likely scenario is PE picks it up on the cheap and tries to sort it out to sell it on again,” the source predicted. The Grocer understands one PE player that has expressed an interest is Karro Food Group and Valeo owner CapVest.
It is believed Hershey’s is looking for about $200m (£141m) – around half the £300m Amplify paid for Tyrrells in 2016.
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Morning update
Fever-Tree Drinks (FEVR) non-executive deputy chairman Charles Rolls has announced the sale of 3m shares in the carbonated soft drinks company at 2,750p a share. The stake represents about 2.6% of the issued share capital. Investec Bank managed the placing. Institutional investors picked up the shares.
Rolls retains 9.9m shares, equivalent to about 8.6% of the company’s share capital.
Settlement of the placing is expected to take place on 27 March. The proposed placing was announced after hours yesterday.
Crawshaw Group (CRAW) chief executive Noel Collett has announced his intention to step down “to pursue other opportunities” but will remain in the job until a replacement is appointed. Alan Richardson, chief financial officer, has also announced his intention to leave the business, in early May, to take up an opportunity outside the value butcher.
The company said trading for the year ended January 2018 remained unchanged. The full year results would be announced in April. Trading in the first six weeks of the new financial year had been challenging, exacerbated by the recent poor weather but the factory shop format continued to perform well, it said.
Jim McCarthy, chairman of Crawshaw Group, said: “The board of Crawshaw thanks Noel and Alan for their contribution and wishes them success in their future endeavours. We anticipate being in a position to announce a new CEO and CFO in the near term who will help drive the business forward.”
Compass Group International BV (CGI BV), a wholly owned subsidiary of Compass Group, has published its annual report this morning for the year ended 30 September. On a consolidated basis, revenue came in at €7.1m (£6.2m) compared with €7.2m in 2016. Operating profit was €440m (2016: €655m), down 33% on the previous year.
Pre-tax profit came in at €550m, down from €940m last time, attributed to group structural changes including the disposal of a Swiss subsidiary which took place in 2016.
Magnit (MGNT), one of Russia’s leading retailers has announced its full-year 2017 results including revenue up by 6.4% from 1,07bn RUR in 2016 to 1.1bn RUR in 2017. Gross Profit increased from 295.8bn RUR in 2016 to 304.64bn RUR in 2017. Gross Margin in 2017 was 26.65%.
Magnit added (net) 2,291 stores during the year. The total store base as of December 31, 2017 reached 16,350 stores (12,125 convenience stores, 243 hypermarkets, 208 “Magnit Family” stores and 3,774 drug stores). Selling space increased by 13.6% compared with 2016 from about 55m sq ft to about 62m sq ft.
GlaxoSmithKline (GSK) has confirmed it has withdrawn form the process for Pfizer’s (NYSE: PFE) Consumer Healthcare business. Emma Walmsley, CEO of GSK said: “While we will continue to review opportunities that may accelerate our strategy, they must meet our criteria for returns and not compromise our priorities for capital allocation.”
On the markets this morning, the FTSE 100 continued yesterday’s fall, of 0.5% to 6,917.8pts.
Early risers include Premier Foods (PFD), up 1.04% at 39p, M&S (MKS), up 0.3% at 266.2p and C&C Group (CCR), up 1.0% at 269 cents
Fallers so far today include Fever-Tree Drinks (FEVR), off 6.2% at 2,775p, Just-Eat (JSE), down 1.1% at 710p, B&M European Value Retail (BME), slipped 0.7% to 400.3p and Britvic (BVIC), fell 0.7% at 665.5p.
Yesterday in the City
The big story was M&S’s (MKS) appointment of Stuart Machin, group CEO of Steinhoff UK, to the new role of managing director of food, who will take up the role in late April. His appointment means the departure of Andy Adcock, director of food, who will leave at the end of next month. The shares closed down 2% at 264.4p.
Nomad Foods (NYSE: NOMD), owner of frozen food brands Birds Eye, Iglo and Findus, reported “an outstanding year” during which it enjoyed 3.9% full-year organic revenue growth.
The latest Retail Sales Index from the Office for National statistics showed the seasonally adjusted value of sales through food stores up 0.6% in February compared with the previous month, and year on year growth of 0.9%
The Bank of England’s Monetary Policy Committee voted by a majority of seven to two to maintain the bank lending rate a 0.5% with a view to meeting the 2% inflation target, and in a way that helps sustain growth and employment.
It said CPI inflation fell from 3.0% in January to 2.7% in February. Inflation is expected to ease further in the short term although to remain above the 2% target.
Developments regarding the UK’s withdrawal from the European Union – and in particular the reaction of households, businesses and asset prices to them – remain the most significant influence on, and source of uncertainty about, the economic outlook, it said.
The FTSE 100 closed down 1.2% yesterday at 6,952.6pts.
Market fallers included Ocado Group (OCDO), down 4.2% at 527p, Greencore (GNC), off 3.6% at 128.2p and Hilton Food Group (HFG), down 4.7% at 766p ahead of next week’s finals. McBride (MCB) fell 4% to 158.8p and Produce Investments (PIL) slipped 2.5% to 159p following yesterday’s interims.
Among the climbers, were Stock Spirits Group (STCK), up 1% at 242p, Patisserie Holdings (CAKE), up 1.8% at 370p, Science in Sport (SIS), up 1.78% at 74.5p and Imperial Brands (IMB), up 1.4% at 2,360p.
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