Premier Foods, Britain's biggest food maker, is in talks with investors and other parties about a cash injection to help cut its debt, it said today.
The maker of Mr Kipling cakes and Bisto gravy, whose shares have plunged almost 90% this year on concerns over its ability to repay £1.8 billion sterling of debt, said it had made no decision on the size or structure of any new investment in the company.
The Financial Times, without citing sources, said Premier Foods was seeking to raise between £200m and £300m from existing institutional investors, as well as external investors, including private equity groups. It said Lion Capital was among the groups that had been contacted by Premier Foods.
Premier Foods said last month it was paying its lenders a fee of £4.9m to postpone a key stress test of its bank loans from December 31 to March 31, and it would also not pay a previously announced interim dividend of 2.2 pence a share.
The company said that talks with potential investors were at an early stage and that it would give full consideration to the rights of its existing shareholders in any decision.
