A £1.13 billion refinancing deal for Premier Foods has wiped the slate clean after six years of uncertainty.
Chief executive Gavin Darby said the deal is a “line in the sand” and leaves the maker of Mr Kipling cakes, Ambrosia custard and Oxo cubes able to focus on its seven power brands.
Darby said: “This is a break out from six years of capital restructuring after too much debt.”
Premier confirmed details of an underwritten equity and rights issue of £353 million, a new pension scheme deal, the launch of a £475 million high yield bond and a new £300 million bank lending agreement where it reduced its banks from 28 to seven. The refinancing deal means net debt has gone down from £831 million to £513 million.
The group has been selling off food businesses to focus on its seven core grocery brands, and sold a stake in its Hovis bread business to US based Gores Group earlier this year.
As well as the financing deal, the food group posted a 12.3 per cent fall in 2013 trading profit to £139.5 million but said its power brands achieved 2 per cent sales growth, and the shares today fell 4 per cent.