:YORKSHIRE BUSINESSMAN Ranjit Boparan tightened his grip on target company Northern Foods yesterday with the announcement he had bought a further 4.8 per cent of the company on Monday. The latest purchase brings his holding in the company to 11.4 per cent.
Some 22.4 million shares were purchased at 73 pence, the same price as the offer bid announced on Friday.
While shares in Northern edged up fractionally higher yesterday evening in London, closing at 74 pence, the consensus among analysts in Dublin and London was that a revised Greencore bid was very unlikely and any alternative offer would struggle to be accepted by Northern Foods shareholders.
Some analysts pointed out that the sale of more than 22 million Northern Foods shares on Monday indicates shareholders are willing to part with their shares at 73 pence, signalling their confidence Boparan’s 73 pence bid is the final offer.
Any revised bid by Greencore would almost certainly involve a cash element, which would have to be financed by a combination of debt and equity raising.
Barclays Capital is advising Greencore, while Rothschilds is acting for Boparan.
Boparan Holdings will send an offer document to shareholders within 28 days of its offer, after which there is a 60-day bid period.
Theoretically Boparan may build up his stake to a level that would block any counter-offer.
Northern Foods shareholders will vote on the original Greencore merger proposal at a scheduled EGM on Monday.
Greencore’s agm will also take place on Monday. Its share price regained some ground yesterday, finishing almost 2 per cent higher at just under €1.16.
Sweet nothings: sugar production problems
LESS THAN a week after Greencore told a Joint Oireachtas Committee it would not return to sugar production at its Mallow plant, business group Ibec has said Irish food and drink companies are having problems sourcing sugar.
Food and Drink Industry Ireland (FDII), the Ibec group that represents the food sector, said a pressure on sugar supply means Irish food companies are being forced to pay exceedingly high prices to import it.
However, FDII director Paul Kelly said Ibec had no position on the question of whether Ireland should return to sugar production. “What we’re highlighting is a short-term issue. At the moment world prices are higher than EU prices, and as a result sugar is being exported out of Europe.”
Ibec is particularly concerned about the EU’s decision to issue 350,000 tonnes of export licences for sugar, which it says is “particularly unhelpful” at a time when sugar supplies are scarce.
Last week Greencore chief Patrick Coveney said the company “cannot envision a basis in business, financial or economic terms that could enable a new sugar industry to emerge in Ireland”.
He told a Joint Oireachtas Committee hearing beet growing in Ireland remains uncompetitive, pointing out that while the institutional price of sugar beet across Europe is €26.30 per tonne while the cost of growing beet in Ireland is at least €30 a tonne.
