Greencore has revealed the final date of completion for its £1.2bn mega-merger with rival Bakkavor, after the Competition & Markets Authority (CMA) gave the final go-ahead early this morning.
The CMA has formally accepted Greencore’s offer to sell its Bristol chilled soups and sauces factory to Compleat Food Group, clearing the way for the two chilled giants to merge.
The transaction is expected to complete on 16 January.
Greencore will now publish its stock market prospectus on 8 January, with Bakkavor suspending listing and dealing of its shares on 16 January, before its existing shares are transferred to new Greencore shares on 19 January.
The transaction is estimated to provide a potential £80m in synergies for the combined group over the next three years, which may provide as much as a 20% premium to Greencore’s share price, according to RBC analyst Tania Maciver.
The combined revenues of the two businesses would start at around £4.2bn in 2026, assuming a 100% contribution from both businesses. Maciver estimated roughly a 2.7% annual growth rate post-acquisition, with major cost savings and profit potential helping the bottom line.
Greencore secured a deal for Bakkavor in April, after twice being rebuffed by Bakkavor shareholders. The merger will create a convenience foods giant that supplies all major supermarkets with a combined portfolio including sandwiches, salads, ready meals, pizzas and desserts.
Greencore’s share price has risen 24.4% in the last 12 months, currently trading at 252.5p.
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