Greencore stake sold to institutions

GREENCORE's plans for a strategic alliance with Archer Daniels Midland, the US food giant, were thwarted yesterday when the Irish government sold its 30 per cent stake to institutions.

The shares were placed at 275p, valuing the holding at pounds 69m. They began the day at 295p but fell back to close at 278p.

The group, formed out of the privatised Irish sugar company, professed delight at the news, despite the loss of the potential link-up with ADM. Gerry Murphy, chief executive, said he was pleased that the placing had removed the market overhang in the shares.

He said he was particularly happy that demand for the shares had come from Irish and overseas institutions.

Observers said that although Greencore had genuinely wanted a link-up with ADM, it had used the US company's interest partly as an attempt to galvanise the government into selling the stake.

The Minister for Finance, Bertie Ahern, told Irish radio a fortnight ago that he was convinced Greencore needed a strategic partner and that ADM was the only bidder for the government's stake.

He said yesterday that ADM ended negotiations because it was unhappy with their duration and public nature. It is understood that the US company was put off by the political controversy that blew up around the sale of the stake when it was first reported that ADM was a potential bidder.

Mr Murphy said that relations with ADM remained good and that Greencore was still interested in forging links with the US group. 'We look forward to exploring mutual opportunities with them and other potential partners.'