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A £700m cash injection is being sought by Premier Foods

Authored by Phil Meekin

Phil Meekin

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Premier Foods, the owner of Hovis, Mr Kipling, and Branston is reportedly seeking a £700 million cash injection. This is in an aim to pay off some of its £1.8billion debts.

There had been speculation that Alchemy Partners, the private equity group, was considering making an offer. This was followed yesterday by reports that a range of suitors including: Bain Capital, Blackstone and Permira as well as many of Premier’s existing investors had been approached by Goldman Sachs, which is advising the company on its finances – including its cash flow – to become an anchor investor. It is rumoured that the sale of a controlling stake in the company is an option.

Premier acquired the bulk of its debt in 2006 and 2007 when it bought RHM. Who are the maker of Hovis bread and Campbell’s soups.

Previously Premier has rejected a £250 million offer from United Biscuits to buy its Mr Kipling brand. Robert Schofield, Premier’s chief executive, said: “Every man and his dog has rung me up to tell me he was interested in some part of my business. Nobody has offered anything that values them correctly.”

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