Take-over rumours at ABF and Unigate

By Peter Crichton

RECENT reports have linked two of the biggest players in the UK pig industry with take-over speculation.

Associated British Foods, which occupies centre stage as major feed compounder, pig marketer and breeder/finisher, has seen its share price tumble by close to 50% in the past two years.

According to City sources, this has left the company wide open to venture-capital predators who could be in the running at about the 3 billion mark.

Take-overs of this nature often lead to break-ups of subsidiary parts of the captured company. BQP and BQF, which produce and process over 10,000 pigs per week, could be affected.

If this occurs, it could cast a cloud over the future of their extensive pig-breeding and fattening operations, which currently provide a secure income for large numbers of their contract rearers and finishers.

Unigate is also attracting interest from Candover, the UK private equity firm.

As well as extensive interests throughout the food sector, Unigate owns the largest pig slaughtering operation in the country.

Many food producers are blaming the power of the supermarkets on a squeeze in their margins and profits.

Until now the UK pig industry has had the security and financial backing of some major public quoted companies, but a drop in share prices has left them attractive targets for asset strippers.

Many food producers are blaming the power of the supermarkets for a squeeze in their margins and profits.