United Biscuits in £2 billion takeover talks
United Biscuits, the company behind KP nuts, Twiglets and Jaffa Cakes has today it is in talks regarding a possible £2 billion Chinese takeover. Chinese operation Bright Food has apparently approached the company's private equity owners, Blackstone and PAI, with regards to a potential purchase. The company was acquired for £1.6 billion back in 2006 although it is believed the operation has significant debt.
Aside from the fact a potential sale of United Biscuits to an overseas company would further distance a well-known brand in the UK from UK ownership there are also concerns about the Chinese company's long-term plans. However, this argument regarding foreign ownership does not ring totally true because the company's private equity owners are non-UK based.
It will be interesting to see how this particular takeover offer progresses and indeed whether United Biscuits falls into the hands of Chinese ownership. The main problem is that the UK market is essentially a "free market" and after years of UK companies raiding overseas markets to acquire the best operations in countries around the world, the tables have been turned. In many ways it is the weakness of sterling which has increased the buying power of overseas companies looking for a way into the UK market.
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