The £1.2bn acquisition of Bakkavor by fellow food manufacturer Greencore was completed as expected this morning (16 January).
Following a series of rejected offers starting in February last year, the two companies struck an agreement in April to form a UK convenience food behemoth with a combined revenue of around £4bn and over 30,000 employees.
The companies noted that the scheme for the transaction became effective in accordance with its terms, having been sanctioned by the court yesterday. It had been cleared by the Competition and Markets Authority in December after a five-month-long merger inquiry, which required Greencore to sell off its chilled soups and sauces factory in Bristol to remedy to competition concerns – this sale to The Compleat Food Group was completed on 12 January.
Under the terms of the scheme, each registered Bakkavor shareholder (as of 6pm last night) is entitled to receive 85p in cash along with 0.604 new Greencore shares and one contingent value right per share held by them at that time.
Settlement of the consideration to which any holder of the scheme shares is entitled will be effected as soon as reasonably practicable and in any event by no later than 30 January, the businesses stated.
While dealings in Bakkavor shares was suspended this morning, an application has been made to the London Stock Exchange for the admission of up to 361,902,219 ordinary shares of 1p each in the capital of Greencore. The new Greencore shares are expected to be trading by 8am on 19 January.
Bakkavor announced that its non-executive directors have each tendered their resignation and stepped down from the board. It was previously reported that Bakkavor co-founders, brothers Agust and Lydur Gudmundsson, would be joining the board of the newly combined group as non-executive directors.
As part of the recommended acquisition released last May, Greencore noted that Bakkavor CEO Mike Edwards and CFO Lee Miley would remain to support the management team for “a period of time following completion”. Dalton Philips will continue his leadership of Greencore as CEO, a role he assumed in May 2022.
“We are proud today to bring together two great companies to create a UK national convenience food champion,” commented Philips. “In Greencore’s centenary year this is another milestone in a remarkable story.”
“With a comprehensive convenience food portfolio across “food for now” and “food for later” we’re really excited by the prospects for our business, and all we can offer our customers and colleagues.
Over past months, we have been putting in place plans to integrate the two businesses effectively and our focus now turns firmly to execution and realising the opportunity ahead of us,” he added.
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