Greencore puts a freeze on Northern Foods bid

Irish foods group Greencore today dropped out of the bidding for ready meals maker Northern Foods.

Greencore's initial all-share offer for Northern Foods, the maker of Fox's biscuits and Goodfella's pizza, was trumped in January by a £342 million cash bid from chicken and Harry Ramsden's chipshops magnate Ranjit Boparan.

Greencore said it had been working with a partner over the past few weeks on a possible takeover of Northern Foods and a simultaneous sale of some of its brands.

"This approach was intended to provide significant funding and allow Greencore to acquire only the parts of the Northern Foods business with the greatest synergy potential," the group said in a statement.

"However, after substantial investigation, the board has determined that an improved offer could not be concluded on terms which would deliver sufficiently strong returns to Greencore shareholders," it added.

Greencore said the costs of its aborted attempt to buy Northern Foods will be treated as an exceptional item in its 2011 results.