Berisford suitor loses ardour

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The mystery suitor that made a tentative bid approach a week ago to Berisford, the Magnet and Welbilt kitchen group, last night pulled out just as mysteriously. Berisford said the unnamed party had withdrawn its interest.

The move will allow the group to go ahead with plans to return part of its pounds 110m cash pile to shareholders by buying back some of the loan stock used to acquire Welbilt.

No reason was given for the withdrawal of the bid approach and Berisford declined to give the name or nationality of the tentative bidder. It will make a formal announcement to the Stock Exchange on Monday which is likely to prompt a sharp fall in its share price.

When Berisford disclosed the tentative approach eight days ago its shares leapt by a quarter to 151p as dealers anticipated a pounds 350m offer for the group, valuing it at 175-200p a share. The shares closed last night at 144p, down 0.5p.

Speculation about the identity of the putative bidder ranged from Electrolux of Sweden to fellow diversified industrial group Tomkins, IMI and Wassall. Berisford's merchant bankers, Barings, apparently got in touch with bankers acting for the bidder at the beginning of this week but discussions proceeded no further.

The company said last night: "The party that previously expressed an interest in making an offer for Berisford does not now intend to put forward an offer."

Berisford's chairman, John Sclater, said: "We are pleased that this period of uncertainty caused by the expression of tentative interest has now ended." This, he said, would allow the group to proceed with the buy- back programme.

News of the withdrawal of the mystery suitor will come as a disappointment to the market. Since its chief executive, Alan Bowkett, came on board in 1992 the City has subscribed more than pounds 400m in rights issues only to be rewarded with profit warnings. The shares fell in September after Berisford warned that profits had been hit by a slowdown in orders at Welbilt.

This came on top of a strike at Magnet's Darlington factory and a period of poor trading which affected its performance.