15th Feb 2019 09:34
LONDON (Alliance News) - Premier Foods PLC on Friday abandoned plans to sell its Ambrosia custards business, citing an unhelpful business climate.
Shares in the Mr Kipling cake and Lloyd Grossman sauces maker were down 4.4% at 35.56 pence each in morning trade on Friday.
The debt-laden food producer in November said it was in talks regarding the potential disposal of the Ambrosia brand. Premier Foods carried net debt of GBP509.5 million as at the end of September 29.
"A number of parties expressed interest in the business, and since the new year the company has been engaged in detailed discussions with a small group of potential buyers," Premier Foods said Friday.
"The board has concluded in the present business climate the process will not result in a satisfactory financial outcome. As a result, these discussions have now concluded," the company added.
The scrapping of Ambrosia sale comes following the departure of its long-time Chief Executive Gavin Darby in January. Darby had been facing calls to step down over the company's strategy and heavy debt.
Oasis Management, which owns a 9.3% stake in the company, in July 2018 said Darby drove Premier Foods into a "zombie-like-state" and had "no credible strategy to return Premier Foods to growth".
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