Division not for sale, says Premier

Premier Foods, Britain’s largest food manufacturer, reported a rise in full year profits and said its struggling ready meals business, which supplies Marks & Spencer, was not for sale.

“With the position that we have got now we have got no need to sell anything at all. We have addressed our financial position,” chief executive Robert Schofield said.

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The group said yesterday that its debt would fall to less than £880m when two recent disposals complete.

“We have received no calls,” Mr Schofield said, when asked if offers had been made for the Brookes Avana chilled convenience business.

Analysts have speculated this unit could be of interest to Irish company Greencore, which has tried to merge with Leeds-based Northern Foods.

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Brookes Avana, which relies on Marks & Spencer for 90 per cent of its business, saw 2010 profit wiped out by lower volumes and reduced margins as commodity price rises could not be fully offset by cost reductions.

Mr Schofield said Brookes Avana’s 2010 performance was “a blip”.

“Our job this year is to get that business back on track,” he said, noting talks with M&S to agree new product ranges and revised pricing and supply arrangements.

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Meanwhile, Greencore yesterday said it is still mulling its options over whether to launch a counterbid for Northern Foods.

Food tycoon Ranjit Boparan has bid £342m for the company, scuppering Greencore’s merger plans.

The companies had been due to merge to create a £1.7bn chilled food giant called Essenta.