BP sale paves way for floats

THE sale of the rump of British Petroleum's nutrition division has opened the way for at least two stock market flotations with a combined value of about pounds 1bn, writes William Kay.

On Friday, BP signed a pounds 355m deal to sell the bulk of its remaining nutrition interests to CINVen, the venture capital arm of the British Coal pension fund, and Baring Capital Investors, part of the Baring Brothers merchant bank. Lord Ashburton, BP's chairman, belongs to the Baring family.

These interests are being repackaged as Nutreco and consist of the majority of BP's feed and animal products, aquaculture, agri-specialities and breeding businesses. With sales of pounds 1.5bn, they add up to one of the world's largest international nutrition companies and include the world's biggest fish-feed company, supplying food for salmon and trout as far apart as Scotland, Norway, Chile and Canada.

This deal comes 15 months after Legal & General Investors, part of the giant insurance group, paid pounds 250m for McBride, a BP Nutrition operation making cleaning and personal- care products for the supermarket own-label market.

'Flotation is far and away the leading option as far as we are concerned,' said Brian Linden, a director of CINVen, which also has a stakes in McBride. He added that both businesses would definitely be expanded, which would take their combined value up from their initial pounds 600m to around pounds 1bn by the time they are ready to be offered to the investing public.