McCormick drops bid for Premier Foods

US spice brand McCormick has walked away from talks to buy Mr Kipling-maker Premier Foods after examining its books.

It said that, after conducting a due diligence review of Premier’s affairs, it was unable to make an offer the “Premier board would recommend”.

Shares in Premier Foods have fallen by over 25% this morning off the back of the announcement.

Premier has previously turned down offers of 52p, 60p and 65p from McCormick, before letting the US suitor take a look at its books and pension obligations.

Premier has acknowledged McCormick’s announcement, but remained bullish, predicting a “strong future” for an “independent Premier Foods”. It also highlighted the benefit of its co-operation agreement with Japanese noodle firm Nissin, which will see it distribute its products in the UK while seeing the availability of its wares increase in key overseas markets.

In a statement, McCormick said: “McCormick has, after careful consideration, concluded that it would not be able to propose a price that would be recommended by the board of Premier Foods while also delivering appropriate returns for McCormick shareholders. Accordingly, McCormick has withdrawn its proposal to acquire Premier Foods.”

Here is how the story has played out over the last few months:

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