Icelandic interest grows as Unilever announces Birds Eye sale – Fishupdate.com

Icelandic interest grows as Unilever announces Birds Eye sale Published:  09 February, 2006

ICELANDIC business eagles are likely to be among the first to swoop for the frozen food business of Birds Eye.

Parent company, consumer goods giant Unilever announced today what everyone expected – that the business is being put up for sale.

The company employs over 600 at its fish products plant in Hull and a similar number at Lowestoft. The Grimsby factory closed last year with the loss of 650 jobs.

Unilever has been seeking ways of reviving its business since it issued a shock profit warning in early September. The firm began a strategic review of the European frozen foods business – which has a turnover of about 2bn euros or £1.5billion – last year.

A number of Icelandic companies have been watching the situation closely and are thought to be especially interested in the Hull fish business.

The firm Bakkover, which bought Geest chilled foods last year, have said they are looking to acquire more UK based food businesses, so they could be among the early bidders. Even the venture capital company which owns Young’s and recently bought up Findus in northern Europe cannot be ruled out.

Sales of frozen foods have come under pressure in recent years as consumers have increasingly favoured fresh or chilled foods. Unilever said it would be retaining its frozen foods business in Italy, and added that its ice cream business – which includes the Carte D’Or, Magnum and Walls brands – would not be affected as this remained a “strategic priority.”

“Deciding to put the majority of our European frozen food business up for sale has been a tough call,” said group chief executive Patrick Cescau.

“However, although we have made great progress in increasing profitability in recent years, growth has been harder to come by.

“After an exhaustive review we have decided that the best way for us to create value is by selling the majority of the European frozen food businesses.”

Birds Eye remains a strong brand in fish, vegetables and ready meals and whoever acquires the business could expand into chilled foods carrying the Birds Eye name.

In Hull unions reacted with concern to the news of the Birds Eye sale. “The factories have attracted a loyal workforce who now face an unsettling and uncertain wait,” said Brian Revell, T&G national organiser for food and agriculture.

“The T&G is very disappointed that of all the options put forward for the future of the site, Unilever has chosen to sell. We will keep a very close watch on the situation but, in addition to job security, there will be natural concern over the future of the pension arrangements.”

Unilever has a frozen foods portfolio in 11 countries: Austria, Belgium, France, Germany, Greece, Ireland, Italy, Netherlands, Portugal, Spain and the United Kingdom. There are five sourcing units: Cisterna – Italy, Reken & Bremerhaven – Germany and Lowestoft & Hull in the UK.

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