Buyers eye up Campbell's Lynn factory

PUBLISHED: 10:50 13 June 2006 | UPDATED: 11:00 22 October 2010

The battle for the ownership of one of west Norfolk's biggest employers is hotting up after it emerged as many as seven different companies were in the running for Campbell's grocery businesses.

The battle for the ownership of one of west Norfolk's biggest employers is hotting up after it emerged as many as seven different companies were in the running for Campbell's grocery businesses.

US giant Campbell Group - the world's largest soup maker - put its UK and Irish businesses up for sale in March after admitting they had underperformed.

Campbell's has been battling for two years to reverse falling sales of its tinned soups and Homepride sauces, which are produced at King's Lynn.

The site employs around 300 workers and produces around 250 million cans of soup a year.

Douglas Conant, president of Campbell, said in March: “Our portfolio in the UK and Ireland includes some strong brands, but is highly fragmented and has not yet our company's growth expectations. It is time to explore strategic alternatives as we strive to optimise the value of these businesses.”

As well as Campbell's soups, the brands include Fray Bentos pies which are also produced at Lynn, and Batchelors Cup-a-Soup, Super Noodles and Oxo stock cubes which are manufactured at other UK locations.

Campbell is thought to have received seven first round offers from bidders for the businesses which are expected to cost around £500m.

Nick Daubney, West Norfolk Council's portfolio holder for regeneration, said the high level of interest in the business was a positive sign.

He said: “It's good news, Campbell's are a major employer, there's plant and employees there that know what they're doing.

“They've been in King's Lynn a long time. There are lots of jobs and lots of skills there. Let's hope whoever does buy it retains the employees and makes a success of it.”

Front runners include Premier Foods, which revealed last month it was interested in acquiring parts of the Campbell business.

Premier, which operates factories at Wisbech, Long Sutton and Bury St Edmunds, already owns a portfolio of well-known brands including Branston pickle, Sarsons vinegar and Loyd Grossman sauces.

Over the past year it has also acquired Birds custard and vegetarian foods business Quorn as it looks to expand its operations.

Foods company RHM is another thought to have made a bid for the Campbell's business. RHM also owns some of the UK's best known food brands including Hovis, Bisto, Sharwoods and Mr Kipling cakes.

Private venture capital groups in the running include Lion Capital, which already owns a number of major food and drinks businesses.

Its portfolio includes breakfast cereal business Weetabix and noodle bar chain Wagamama. It also bought the European drinks business of Cadbury Schweppes last year with fellow private equity firm Blackstone and used to own Premier Foods before it was floated on the stock market last year.

The sale of the Campbell's brands comes as bidders circle around Unilever's frozen foods business Birds Eye. The operation, which includes the giant Lowestoft factory with almost 900 workers, is expected to sell for around £1billion.

Last week Unilever sent out a sales memorandum of the business with private equity firms CapVest and Blackstone thought to be the front runners. CapVest, which owns Young's Bluecrest is thought to have teamed up with Blackstone to launch a joint bid.

Other contenders include Lion Capital.

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