Greencore to move to British listing

THE GREENCORE chief executive has said the company hopes to maintain a secondary listing on the Irish market after the company moves its main listing to the UK, following its planned acquisition of British food company Uniq.

Patrick Coveney said such a move was unlikely to take place before 2013.

He was speaking after a specially convened Greencore extraordinary general meeting in Dublin at which more than 99 per cent of shareholders voted in favour of the proposed acquisition of British food company Uniq.

Some 90 per cent of the company is owned by institutional shareholders.

Mr Coveney said there had been an “overwhelming” response from shareholders to the deal, which will see Greencore acquire its British rival for £113 million (€128.5 million).

Greencore is preparing to move its primary listing to London, and will also report in sterling. Shareholders can choose whether to receive their dividend in sterling or in euro.

Uniq had been effectively on the market since 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.

The announcement by Greencore on July 12th that it had made a £113 million offer for Uniq came four months after the company announced it was abandoning its proposed merger with Northern Foods, following Ranjit Boparan’s £342 million offer for the British company. While Uniq’s sandwich business, particularly its contract to supply sandwiches to Marks Spencer, is perceived to hold major opportunities for Greencore, its dessert business is more problematic.

Mr Coveney refused to be drawn yesterday on Greencore’s plan for the division, indicating that the company was supportive of the Uniq management’s recent review of the business.

The Uniq deal, which is subject to clearance by the Office of Fair Trading, should be completed within six to eight weeks, Mr Coveney said.

Following the acquisition, Uniq’s executive directors will depart the business, although the management team of each individual business within the Uniq Group are expected to remain with the company.

Greencore is undertaking a rights issue to raise capital of approximately €80.2 million, with current shareholders eligible to buy new Greencore shares based on the number of Greencore shares they already hold.

Dealing in the new nil paid shares is expected to get under way this morning at 8am.

Shareholders who do not choose to take up or sell their rights will see their rights lapse on August 23rd, at which point the new shares will be sold to investors in the market.

Greencore’s share price closed down 3.5 per cent at €0.84 yesterday. Responding to questions about the company’s share price, Mr Coveney said that the recent softness in markets, as well as the technical complexities of the rights issue, may be contributory factors.