GREENCORE’S SHARE price climbed by more than 20 per cent yesterday, following the surprise announcement that the company has received a preliminary takeover approach.

Greencore, which is currently finalising its takeover of British sandwich and dessert maker Uniq, issued a stock exchange announcement yesterday afternoon, stating that it had noted the movement in the company’s share price and “confirms that it has received an approach which may or may not lead to an offer for the company”.

Greencore’s share price closed up 10 per cent yesterday at 68 cents, giving the company a market value of €260.7 million.

The share price has found it difficult to get past 60 cents since mid-August, despite the Uniq deal, having hit highs of more than €1.30 in January, when a merger with Northern Foods was still on the cards. The low share price has meant the company has been attractive as a takeover target.

Greencore’s share price began creeping up on Monday. The London market saw heavy activity in Greencore on Monday, with 340,000 shares traded. This compared to less than 100,000 on average each day the previous week, and about 260,000 yesterday.

There were four times the average number of Greencore shares traded in Dublin yesterday.

Analysts in London and Dublin expressed surprise at the announcement, with most suggesting that a UK private equity firm was the most probable suitor.

Doughty Hanson has been previously linked with Greencore, although a number of London-based private equity firms are involved in the food sector.

Greencore held talks with food giant Nestlé after the collapse of the Northern Foods deal. ABF has also been reported to have been interested in the Irish food company.

Another possibility is a management buyout, with some analysts in London and Dublin suggesting that a management tie-up with a private equity partner may happen.

It is almost a year since Greencore announced its proposed merger with British rival Northern Foods, which was ultimately derailed by an offer from businessman Ranjit Boparan, who took the British company private.

In July Greencore announced it was to buy British company Uniq for €128.5 million, making it a major player in the British convenience food and sandwich industry. The acquisition, which was given the green light by the Office of Fair Trading earlier this month, gave Greencore the opportunity to supply to MS, though Uniq’s less profitable desserts business, which represents about half of Uniq’s turnover, was seen as more problematic for the Irish company.

The acquisition, which is to see Greencore move its listing to the UK but keep its headquarters in Dublin, was expected to lead to more than £10 million in cost-saving synergies.

Uniq was put on the market in April after the company’s pension fund trustees took control of 90 per cent of the company by way of an unusual equity-for-debt swap, in a bid to deal with the company’s £400 million-plus pension deficit.