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12 July, 2006 - 10:37 By Staff Reporter

Premier tables £460 million bid for Campbell's UK

Premier Foods in St Albans has made a £460 million bid for Campbell Soup’s UK division, the manufacturer of such iconic ambient food brands as Oxo, Batchelors, Homepride and Fray Bentos.Premier Foods in St Albans has made a £460 million bid for Campbell Soup’s UK division, the manufacturer of such iconic ambient food brands as Oxo, Batchelors, Homepride and Fray Bentos.

The acquisition is conditional on Campbell shareholder approval and if passed will be conducted on a debt-free, cash-free basis, will be underpinned by a fully underwritten Rights Issue raising gross proceeds of approximately £450 million.

The acquisition is well in line with Premier’s corporate strategy and would be its fifth major purchase in the past four years.

In the financial year ended 31 July 2005, Campbell’s UK had sales of £263 million, operating profit before management charge and financing costs of £26 million and Acquired EBITDA of £54 million. The UK and Ireland account for 98 per cent of sales. are in the UK and Ireland and 94 per cent.

Projected cost synergies from the combination of Premier’s business with Campbell’s UK is £28 million within three years. The acquisition is also expected to be margin enhancing and earnings accretive in the first full year.

Premier Foods’ chief executive, Robert Schofield, said:“The Campbell’s UK business fits Premier like a glove. This acquisition will bring an excellent portfolio of powerful and iconic brands which we intend to drive forward with increased resource and innovation.

“In addition, the very substantial synergies which Premier can deliver make this transaction highly compelling from a financial perspective. Moreover, we are putting in place a financing structure which will give us the flexibility to continue to pursue our acquisition strategy.”

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