Matthews faces rival offer for turkey firm

The American company Sara Lee said yesterday it was considering making a rival offer for Bernard Matthews plc, the "bootiful" turkey company.

The American company Sara Lee said yesterday it was considering making a rival offer for Bernard Matthews plc, the "bootiful" turkey company.

The news came just hours after the Matthews family, which already controls 42 per cent of the company's shares, announced an offer to buy out the shares it does not own in order to take the stock market-quoted business private.

The surprise statement from Sara Lee, released after the stock exchange had closed, said it had "noted" the announcement made by Bernard Matthews plc and was "considering whether or not to make an offer" for the company.

The Matthews family's offer of 185p a share values the company at £232m.

City analysts said the giant Sara Lee business could afford to pay more, but the Norfolk packet meat specialist could be "better off" as a private concern. The group floated on the stock exchange in 1971, valued at £4m.

Bernard Matthews, who founded the business 50 years ago, explained yesterday why he thought his company's future lay as a private company. "The stock market wants you to go on increasing profits all the time and that is not necessarily the best thing for a company to do," he said. "The [City] hasn't done much for us and we have never raised any money on the stock market."

To scupper Mr Matthew's plans, Sara Lee would have to persuade 50.01 per cent of Bernard Matthews shareholders to accept its, as yet undetailed, counter-bid.

The Matthews family already claims to have the support of shareholders representing 55.3 per cent of the company, including its own stake, but that may change if more money is on offer from Sara Lee. The Bernard Matthews' annual sales are £344m and the business shifts some six million packets of branded meats a week.

If Sara Lee is successful, it would be the second time this year that it has swallowed up an old-economy British firm.

In June, it completed the £160m purchase of Courtaulds Textiles, the company which manufactures Berlei and Gossard underwear.

Mr Matthews, 70, started his business after a spell in the RAF's 617 "Dam Busters" squadron followed by a £1.50-a-week job in a small auctioneering company in Norfolk. He decided to augment his income by selling turkeys at auction.