Booker plays down talk of imminent Nurdin bid

NIGEL COPE

Booker, the food-processing and cash-and-carry group, yesterday played down speculation that it was set to bid for Nurdin & Peacock, the rival cash-and-carry operator.

Reporting an 11 per cent rise in profits to pounds 100m, Booker's chief executive, Charles Bowen, said: "Internal growth is our priority. The cash and food service division is growing very well and there are further efficiencies to be made."

Shares in Nurdin have been rising recently on rumours that Booker was set to strike. The situation is complicated by a large stake owned by the Peacock family as well as a 14 per cent stake controlled by the Dutch group, SHV Makro, which is also thought keen to increase its holding.

Analysts believe a Booker-Nurdin deal would make strategic sense, enabling Booker to reduce costs and close stores that overlapped. A bid at around 197p would value the company at pounds 250m. Booker shares closed 13p higher at 395p. Nurdin's shares edged 4p higher at 172p.

Mr Bowen was sanguine about the possibility of Makro making a bid instead, which would leave Booker with a far larger competitor. "We are gaining market share from all our competitors. Even if SHV bought Nurdin we would be confident going up against it," he added.

Booker is the largest cash-and-carry operator in the UK, with 160 sites. It has outlets in Portugal and seeks to expand in other European markets and the Far East. Nurdin is smaller and has been changing its stores into the TBW format.

Booker's figures for the year to December were at the top end of City expectations. Profits of pounds 100m were struck on turnover 14 per cent higher at pounds 4.2bn. The group's salmon operations performed strongly, boosted by a 20 per cent rise in salmon consumption. Booker has maintained its market share despite some fish-dumping by Norwegian producers. Along with some Scottish producers Booker is seeking action from both the UK government and the EU. The fish and prepared-foods business could be a candidate for disposal after a difficult year.

Raw material prices have been rising and proved difficult to pass on to supermarkets. The company is therefore trying to cut costs. Cost control enabled Booker to improve margins last year and the company said it planned to repeat the performance this time.