United Biscuits sales cost pounds 35m

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The Independent Online
United Biscuits said it would incur a charge of about pounds 35m for the sale of a string of businesses outside its key UK market.

The maker of McVitie's cookies and KP snacks also said business over the Christmas period was satisfactory and that its 1996 profit would be as anticipated at the time of the interim results.

The company is retrenching to focus on its main UK markets after posting big losses overseas in recent years.

It has already sold its Ross frozen vegetable business and its Keebler cracker and cookie operation.

"These steps represent a very considerable tidying up and strengthening of our business portfolio and balance sheet," said Eric Nicoli, group chief executive. "We now have a healthy balance of progressive established businesses and interests in emerging markets and we have a solid platform for further growth."

United Biscuits said its latest disposals were a 60 per cent stake in ICA, an Italian snack food producer, an 84 per cent interest in S&A, a Portuguese snack business, and a 46 per cent stake in Aguia, a Brazilian cookie maker.

It also said it closed its Gyori Snacks unit in Hungary and would shed its 30 per cent stake in Kargida, a Turkish snacks business.

Alex Leohnis, an analyst at UBS, described the moves as "tidying up" and said much of the disposals had been well flagged. On the trading statement, he said: "There has been very little they have said over the past year and a half that hasn't been as expected."

He said the group had been at pains over the past year or so to prove that it was a stable ship.