Greencore, the sandwiches and ready meals maker, expects to complete its £1.2 billion (€1.36 billion) takeover of Bakkavor in mid-January after the UK competition regulator accepted its proposal to sell its Bristol manufacturing facility.
Trading in Bakkavor’s shares will be suspended on January 16th, and the company will be delisted from the London Stock Exchange on January 19th, according to an indicative deal timeline published on Wednesday.
It follows the UK Competition and Markets Authority’s (CMA’s) acceptance of Greencore’s undertakings relating to its offer to sell its Bristol manufacturing facility, which makes chilled soups and sauces.
The offer to sell the facility to a third-party company, Compleat Food Group, averted an in-depth, phase two investigation of the deal by the CMA.
RM Block
The CMA raised concerns in October that the planned merger would affect competition in the supply of chilled sauces. It gave both companies a week to come up with a solution to address the issues raised by the authority before a stage two investigation was launched.
The deal to create a leading convenience food business in the UK, with a combined revenue of £4 billion, was announced in April. It will see existing Greencore investors own 56 per cent of the enlarged group, with Bakkavor investors holding the remainder.
Greencore and Bakkavor share the same customers among big UK supermarkets – including Tesco, Marks & Spencer, Sainsbury’s, Waitrose and Asda – but have limited crossover in products. Bakkavor adds pizza, bread, desserts and dips to Greencore’s range, which already spans sandwiches to salads, sushi and ready-made meals.
The CMA raised concerns in October that the planned merger would affect competition in the supply of chilled sauces. It gave both companies a week to come up with a solution to address the issues raised by the authority before a stage two investigation was launched.
Bakkavor, founded 40 years ago by Icelandic brothers Agust and Lydur Gudmundsson, sold its Greencore stake at a loss in October 2008 as the Gudmundssons saw their broader business empire come under pressure during the financial crisis.
