$500m US sale for United Biscuits

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The Independent Online
United Biscuits has sold the largest part of its loss-making Keebler business in the US for $500m (pounds 316m). The cookie and cracker operation has been acquired by Inflo, a newly formed joint venture between Flowers Industries, a US foods company, and Artal Luxembourg, an investment group.

Last year the cookie and cracker division recorded profits of pounds 54m on sales of pounds 900m. Net assets are estimated at pounds 237m.

The sale will halve United Biscuits's borrowings and reduce pressure on the company's stretched balance sheet. However the price was at the lowest end of City expectations. Analysts now doubt that the company will achieve the hoped-for pounds 500m-700m from the Keebler disposal. United Biscuits said yesterday it still expects to sell Keebler's loss-making salty snacks business by the end of its financial year next January and that negotiations are at "an advanced stage."