Ireland-based food supplier Greencore has reportedly made an improved offer in its endeavor to acquire UK peer Bakkavor.
According to news agency Bloomberg, citing “people with knowledge of the matter,” the details of the improved bid remain undisclosed. However, their sources indicated that Bakkavor is currently evaluating the new proposal.
Neither Greencore nor Bakkavor, both key suppliers to large UK supermarket chains, have provided comments on the situation.
On 14 March, Greencore, like Bakkavor listed on the London Stock Exchange, announced that it had submitted two offers for its rival in recent weeks.
The most recent rejected bid, submitted on 7 March, comprised a mix of cash and shares, valuing Bakkavor at £1.14 billion ($1.47 billion at the time).
Under the proposed terms, Greencore shareholders would own approximately 59.8% of the combined entity, while Bakkavor investors would hold the remaining shares.
Greencore emphasized that merging the two own-label suppliers would establish “a leading UK convenience-food business.”
Conversely, Bakkavor characterized the offers as “unsolicited, conditional, cash-and-share proposals.”
It further stated, “The board of Bakkavor, together with its financial advisers, carefully evaluated the latest proposal and concluded that it significantly undervalued the company and its future prospects.”
Following the last rejection, Greencore reiterated its intention to assess all strategic opportunities, including a potential acquisition of Bakkavor.
When questioned by if it would issue a third bid, Greencore chose not to comment, yet highlighted its belief that merging the businesses represents “a highly compelling value creation opportunity for both Bakkavor and Greencore shareholders.”
In its report regarding a new bid emerging, Bloomberg noted that Greencore must announce by 5 PM, local time, on 11 April whether it intends to make a firm offer or withdraw.
Bakkavor produces a range of products, including ready meals and desserts, for retailers such as Tesco.
In 2024, Bakkavor generated over 80% of its £2.29 billion underlying revenue in the UK, while also operating in the US and China.
Meanwhile, Greencore supplies chilled, frozen, and ambient food from 16 factories across the UK, catering to major grocers, including Tesco, Sainsbury’s, and Asda. In its last financial year, Greencore reported a revenue of £1.81 billion.
