Premier Foods is to consider offering a slice of its Hovis business to outside investors in a bid to revive the company’s bread division.
The group, whose other brands include Mr Kipling and Bisto, has appointed Ondra Partners to assist in developing options for the business, which could include co-investment by a partner. Premier could spin out the bread business into a separate company which would be jointly owned by Premier Foods and a new investor.
St Albans-based Premier said: “There can be no certainty that a transaction will follow at any point in the future.” An outright sale of the bread arm is not thought to be under review, having been considered last year. Premier, which has debts of £890m following a spending spree has sold a number of businesses, including Sarson’s vinegar and Haywards pickles.
Bread sales reduced by 0.7% to £240.6m in the half-year to June 30 while the Hovis-branded division lost £75m in annual sales after not to renewing a low-margin contract with the Co-op.