UK: Premier Foods Group announces refinancing plan after profit and revenue fall
Premier Foods has announced a detailed plan to recapitalise its balance sheets, including issuing £353m ($588.7m) in new shares, following a drop in its full year profits and revenues.
According to Just Food, this injection of capital will help Premier Foods tackle its high debt levels. The group ended 2012 with net debt of around £890m ($1,484.9m) and a pension deficit of £3,394m ($5,662.6m). Alongside the new shares, Premier Foods is issuing bonds to raise £475m ($792.5m) and has also secured a recurring £300m ($500.1m) credit facility, it said. Over the past year the company during claimed that it had managed to cut its debt by £120m ($200.2m) by reducing “complexity” and taking a “disciplined approach” to its costs.
Chief executive Gavin Darby said: "This new capital structure will liberate Premier Foods from its past and provides a great platform on which to execute our category based strategy."
Premier Foods has recently aimed to simplify its portfolio with the disposal of non-core brands such as Branston pickle and Hartley’s jam. It is instead refocusing on higher margin “power brands” such as Lloyd Grossman sauces, Bisto gravy and Mr Kipling cakes.
Source: Just Food