Bowkett makes £6.4m profit as shares return

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The Independent Online
Alan Bowkett, chief executive of Berisford International, made a potential paper profit of £6.4m - £13,000 a minute - yesterday as shares soared after coming back from suspension.

The Berisford shares were suspended at 228p on 19 December, one day before the company announced a £200.5m takeover bid for Welbilt, the US kitchen equipment maker.

The shares shot up 45p to 273p yesterday, as the market reacted favourably to the earnings enhancing potential of the US acquisition in its first year.

The rise gave Mr Bowkett an immediate £675,000 profit on the 1.5m shares he holds in Berisford. He also has until 28 January to exercise options to buy 1.49m shares at 98p - giving him a £2.5m paper profit at yesterday's closing price. From 28 January hecan exercise rights to buy 1.55m shares at 64.4p which could net him a further £3.2m.

Mr Bowkett is widely credited with having successfully redirected Berisford, a former commodities and property group, since coming on board in 1992. The company had previously been brought close to collapse through disastrous US property investment.

Mr Bowkett was unavailable for comment yesterday. But a spokesman said: "It should be realised that any gains he enjoys have been well-reflected in gains for all Berisford shareholders." Mr Bowkett tried to reshape the group as an industrial holding company.

Last January Berisford paid a consortium of banks £56m for the Magnet kitchen and joinery business, one of the most spectacular management buyout failures of the decade. Last month Berisford announced its first dividend in five years. Welbilt, which mak e s the chip fryers for every McDonald's in the world, is the second major strategic move. It also supplies Pizza Hut and Burger King. It is 47 per cent owned by Jerome Kohlberg, one of the founders of leveraged buyout specialist Kohlberg Kravis Roberts.

One analyst said yesterday: "The market's reaction now the shares have come back from suspension is that Welbilt is a very good deal which is quickly earnings enhancing. The City felt it was a good move when it was announced before Christmas and this share price jump following the shares' relisting was widely expected."

Mr Bowkett bought into the shell of Berisford after making his fortune in the buyout of a ballbearing maker. Until 1987 he was managing director of Boulton & Paul, a BET subsidiary. He is a non-executive director of Greene King, the East Anglian brewer. A former alumnus of the London Business School, he lists his recreations as "growing vegetables, opera, shooting, Italy".

Mr Bowkett has said Welbilt is a good opportunity to acquire an established business in a big, fragmented market. He is also looking for companies with leading market shares. In addition to the basic purchase price, Berisford will take on Welbilt's net debts of £94.7m.

An EGM of Berisford shareholders is to be held on 23 January, to ratify the Welbilt acquisition.

The purchase is being financed by a £317m rights issue of more than 300 million units of convertible loan stock, giving holders the right to buy 11 units for every five they hold.