LONDON (CNNfn) - A trans-Atlantic takeover battle loomed in Europeís food sector Wednesday as Nabisco boosted its offer for Britainís United Biscuits while French giant Danone remained poised to lead a rival bid.|
Nabisco Holdings and Texas-based buyout specialist Hicks, Muse, Tate & Furst, who made a friendly 245 pence a share offer for Europeís second-largest cookie and cracker maker Tuesday, raised the bid to at least 254 pence a share. The Nabisco group claimed it has already secured acceptance from 30 percent of United shareholders.
The original offer valued United at 1.16 billion pounds ($1.88 billion).
Analysts said the raised offer was attempting to flush out any rival bid from Finalrealm, a consortium including Danone and two private equity houses.
United (UBIS) shares rose to 260 pence Wednesday afternoon after the higher bid was announced. The stock closed up 9 percent at 254 pence Tuesday amid speculation of a second or even third offer.
Danone (PDN), best known for its dairy products and Evian mineral water, has teamed up with the private equity arms of Paribas and Deutsche Bank to bid for United. Finalrealm is reported to have seen an earlier bid worth 242 pence a share rebuffed and was believed to be considering an offer of up to 260 pence.
Finalrealm was unavailable for comment as to whether it would raise its target price.
While the U.S. offer plans to integrate United into the biddersí operations, Finalrealm plans to break up United, selling its Continental units to Danone, and allowing the venture capitalists to spin off the U.K. business.
Danone shares fell 1 percent to 219.40 euros Wednesday, having headed down for most of the year in tandem with much of the depressed food sector.
The Nabisco-led offer values United at well below the 260 to 270 pence a share expected by industry sources when bidding first began, after UB put itself up for auction in October. But it represents a 30 percent premium to Unitedís share price on Oct. 4, before takeover speculation started, and is 10 percent above its closing price in London Monday.
Hicks, Muse and Nabisco (NA) decided to pool their efforts after previous separate attempts to raise an offer by both firms fell down.
Under their latest bid United Biscuits, best known for brands such as McVities and Penguin, would be renamed Burlington Biscuit Holdings, and would encompass the European and Middle East biscuit operations of Nabisco and Hicks, Muse.
Nabisco would hold a 23 percent stake in the new company, with the private equity specialist retaining the balance.
-- from staff and wire reports