Convenience foods manufacturer Greencore looks poised to benefit from any retailers disillusioned by Northern Foods' decision to restructure.
Northern Foods announced last week it was to reduce its dependence on own label in favour of brands, and was planning to sell parts of the business producing cakes, speciality breads and chilled pastry products.
Greencore is a major
player in the cakes and sandwiches categories, and also makes quiches and flans, fuelling speculation that it might be interested in acquiring some of the unwanted operations from Northern Foods.
Greencore chief financial officer Patrick Coveney refused to rule out a possible bid but hinted that Northern Foods' restructuring could benefit Greencore without the need for acquisitions, because its rival could start to lose disillusioned customers.
Coveney said: "We're in a position where we don't need to buy anything to deliver our growth aspirations. However, where there's an opportunity to acquire a business that fits with our strategy of good growth, a high concentration of companies in the market and a good channel mix, we might look at that.
"However, in private label and customer branded if you don't demonstrate high levels of commitment and loyalty then it can be quite difficult to retain
your business.
"In the case of the businesses Northern Foods is looking to sell, it is quite possible that the performance and customer profile of those businesses might well change."
Ireland-based Greencore announced a pre-tax loss this week of E11.3m for the six months to March 31 on sales of E658m - after writing off the expected cost of exiting the sugar industry, which is being reformed by the EU.
Coveney said the company would be back in profit by this time next year as it increased its convenience foods focus.
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