Wiseman gatecrashes Unigate deal with Dairy Crest

Unigate, the milk to chilled foods group, yesterday said it had received a preliminary £225m approach for its dairy and cheese businesses, just weeks after agreeing to merge the division with rival company Dairy Crest.

Unigate's shares closed up 25p at 324.75 after Robert Wiseman Dairies, the Scotland-based milk distributor, said it had "made an approach to Unigate with a view to the possibility of purchasing [its] dairy and cheese activities". Wiseman said: "It is envisaged that any purchase would be wholly in cash and would be funded through new bank facilities."

Dairy Crest had previously agreed to buy the business by issuing 75.7 million of shares and taking on £100m of Unigate's debt. Under that deal, Dairy Crest shareholders would own 60 per cent of the enlarged group, with the rest belonging to Unigate shareholders. Dairy Crest's shares yesterday closed down 2.5p at 132.5p, valuing its offer at about £200m. Wiseman's shares were suspended at 83.5p.

Sir Ross Buckland, Unigate's chief executive, said: "We have wanted to add value to our liquid milk and dairy business for some time. We were able to reach an agreement with Dairy Crest, and now Robert Wiseman has presented us with an alternative."

He said the company would continue its discussions with Wiseman while "discharging its duties" to Dairy Crest, including supplying the group with forecasts and new listing particulars.

Dairy Crest said it was "considering its position with its advisers and will be making a further announcement in due course". It claimed its agreement with Unigate remained binding.