Weetabix group considers float

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The Independent Online

Some of Britain's best-known food brands, including Typhoo Tea and Sun-Pat peanut butter, are set to go under the hammer with the sale of Premier Foods, the consumer goods business owned by the US private equity group Hicks, Muse, Tate & Furst.

Some of Britain's best-known food brands, including Typhoo Tea and Sun-Pat peanut butter, are set to go under the hammer with the sale of Premier Foods, the consumer goods business owned by the US private equity group Hicks, Muse, Tate & Furst.

It has confirmed the appointment of Merrill Lynch to advise it on strategic options for the foods business, which include a flotation or a trade sale. Premier's value is thought to be worth more than £1bn.

Hicks, Muse bought Weetabix for £642m last November and has held it as a separate business from Premier. However, Lyndon Lea, who runs the Hicks, Muse operations in Europe, has said the breakfast cereal business may be integrated into Premier Foods. The inclusion of Weetabix, albeit sooner than normal for a private equity sale, would make the enlarged food group more attractive to the stock market and trade buyers alike. The stock market lost patience with food companies in the late 1990s, partly because many were badly run but also because the technology boom left them out of favour.

Hicks, Muse took advantage of this in summer 1999 when it bought Hillsdown Holdings, which has formed the basis of its Premier Foods operation. It has subsequently added grocery brands from Nestlé and Unilever to build a business with brands that include Branston Pickle, Cadbury's Drinking Chocolate and Gale's Honey.

Hicks, Muse's most recent sale was the Yell directories group, which owns Yellow Pages. Yell was floated and is now a FTSE 100 company.

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