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THERE was renewed speculation this week that the Findus Group, which owns Young's Seafoods, is about to be split up and sold off.
The Financial Times reported yesterday that the private equity company Lion Capital, which owns Findus, is in advanced talks about a possible sale. The bidders mentioned included the Nestle Group, Leroy Seafoods (which would almost certainly be interested in all or part of Young's) and the Norwegian consumers group Orkla.
So far none of the parties were prepared to confirm or deny the report, saying they did not comment on speculation. But the fact they have not denied it outright is significant.
Lion Capital paid around £1.1-billion for the Findus Group in 2008 but in doing so Findus acquired a large debt, now said to be around £700-million. The recession, and the rising cost of fish have affected performance in the past two years. The hope that the economic downturn would make frozen fish more attractive to the consumer have not lived up to expectations.
It was reported in January that Lion Capital tried but failed to raise capital last year by attempting to sell part of its French business to rivals Birds Eye. It was also said that it had asked to waive a quarterly covenant test at the end of last year.
Young's which employs more than 3,000 people, at various production sites in Grimsby and Scotland, returned to profit last year with a surplus in 2010 of £7.4-million.
The impact on Grimsby and the Scottish sites of a sale to a company like Leroy is unknown until any deal is struck. But Grimsby's food town prospects took a severe blow last week when the Irish company Kerry Foods signalled that it was closing the Grimsby factory with the loss of 337 jobs. Most of Kerry's ready meal production on the Humber is meat rather than fish based.
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