Bosses at Iceland Foods Group are understood to have launched a bid to buy DBC Foodservice after Baugur, which owns a 50% stake in the company, was placed into administration.
The Grocer has learned that Iceland Foods' CEO Malcolm Walker and its financial director Tarsem Dhaliwal, who is also chairman of DBC, want to run the two companies in tandem.
The other 50% of DBC is owned by Icelandic investment fund Fons Eignarhaldsfelag, which until recently owned shares in Iceland Foods and is understood to be interested in selling its stake.
DBC had previously announced that it was working with Iceland Foods to improve its frozen range.
One wholesaler told The Grocer that he had heard from suppliers that Iceland Foods had been "backing" DBC for some time.
"There would be clear synergies to be made from running the two companies together," he said. "They could use Iceland's clout to get better deals from suppliers. Walker will know how to make this work for the good of both companies."
DBC is in the process of turning itself around following its disastrous attempted merger with Woodward Foodservice.
Another insider said DBC would be unlikely to fetch a good price at the moment because it only made £700,000 pre-tax profit on a turnover of £247m in the year ending March 2008 - a profit margin of 0.3%.
However, DBC is growing and may fare well despite the recession. About three quarters of the value of its contracts are in the 'cost sector', comprising schools and councils, which are thought to be relatively recession-proof. And it is seeking to sign up more restaurant and pub chains. It also has the contract to supply Little Chef.
Walker refused to discuss the DBC deal but suggested that he would be in a better position to comment in a few weeks.
He also declined to comment on whether he would buy out Baugur's 13.7% stake in Iceland Foods Group.
The Grocer has learned that Iceland Foods' CEO Malcolm Walker and its financial director Tarsem Dhaliwal, who is also chairman of DBC, want to run the two companies in tandem.
The other 50% of DBC is owned by Icelandic investment fund Fons Eignarhaldsfelag, which until recently owned shares in Iceland Foods and is understood to be interested in selling its stake.
DBC had previously announced that it was working with Iceland Foods to improve its frozen range.
One wholesaler told The Grocer that he had heard from suppliers that Iceland Foods had been "backing" DBC for some time.
"There would be clear synergies to be made from running the two companies together," he said. "They could use Iceland's clout to get better deals from suppliers. Walker will know how to make this work for the good of both companies."
DBC is in the process of turning itself around following its disastrous attempted merger with Woodward Foodservice.
Another insider said DBC would be unlikely to fetch a good price at the moment because it only made £700,000 pre-tax profit on a turnover of £247m in the year ending March 2008 - a profit margin of 0.3%.
However, DBC is growing and may fare well despite the recession. About three quarters of the value of its contracts are in the 'cost sector', comprising schools and councils, which are thought to be relatively recession-proof. And it is seeking to sign up more restaurant and pub chains. It also has the contract to supply Little Chef.
Walker refused to discuss the DBC deal but suggested that he would be in a better position to comment in a few weeks.
He also declined to comment on whether he would buy out Baugur's 13.7% stake in Iceland Foods Group.
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