ALLIED-LYONS yesterday confirmed it is looking to sell its food manufacturing businesses, which include Tetley tea. Analysts estimate they could be worth more than pounds 500m and the company's shares rose 4p to 550p.
Responding to recent speculation that the company wanted to withdraw from this area, Michael Jackaman, chairman, told shareholders at the annual meeting at the London Hilton on Park Lane: 'We will continue the process of refocusing your business through acquisition, investment and disposal.
'We have said we plan more disposals, to add to the pounds 400m-plus already achieved in the last two years. We are actively exploring the possibility of disposals in our food manufacturing businesses.'
Allied's food businesses are in four sections - beverages, bakeries, ingredients, and a small UK seafood operation. Besides Tetley tea, another well-known brand that may be sold is Maryland Cookies.
Lyons will be dropped from the company's name in the autumn, replaced by Domecq, which was bought for pounds 739m in March. The name Allied-Domecq, Mr Jackaman said, 'encapsulates the very considerable reshaping we have undertaken in the 1990s.
'While there are obvious regrets about moving on from Lyons with its own associations . . . the incorporation of Domecq into our name underlines the importance of spirits in our new group.'
He added: 'Our plans for Domecq have been well-received as part of our strategy to become a world class marketer of spirits. We are now world number two in spirits, owning 13 of the top 100 brands.'
Allied's five biggest spirits brands are Ballantine's, Courvoisier, Kahlua, Canadian Club and Beefeater.
Domecq sells 24 million cases of drinks a year, which will double Allied's total sales of spirits and wines. Ramon Mora-Figueroa, chief executive of Domecq, is to join Allied's board.
Mr Jackaman also damped down rumours that Allied was planning to withdraw from the fledgling joint brewing venture with Carlsberg of Denmark.
'Carlsberg-Tetley had a difficult start, its operations commencing at a time both of adverse industry conditions and of regulatory change,' he said.
'It has established a good base however, and is now competing strongly. We are committed to the business and confident of its long- term success.'
Carlsberg-Tetley is one the four biggest brewery operations in the UK, producing the well-known Carlsberg lagers and Tetley bitter.
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