Bisto to Mr Kipling group Premier Foods PLC (LON:PFD) has rejected two approaches from US food giant McCormick & Company and instead agreed a co-operation deal with noodle giant Nissin.
New York-listed spices group McCormick made indicative offers worth 52p and 60p per share, with the second approach coming just last week.
Premier Foods rejected both as they significantly undervalued its growth prospects, it said.
David Beever, chairman, added the offers were an attempt to capture the upside value embedded in Premier's business that rightfully belonged to Premier's shareholders.
McCormick is required to make a firm offer by 20 April or walk away.
The deal with Japanese group Nissin, meanwhile, will see the two firms work together on instant noodle products using Premier’s brands and boost distribution of Premier brands abroad. Premier may also allow Nissin a seat on the board if it takes a sizeable stake in the company.
Gavin Darby, Premier’s chief executive, said it was an exceptional opportunity to gain a major strategic partner that understands its business.
He added trading in 2015 had been in line with expectations with investments in its biggest brands (Mr Kipling, Cadbury cakes, Oxo and Bisto) delivering gains in volume, value, market share and household penetration.
Investment in consumer marketing will rise to £36mln in the 2015/16 financial year and cost £2-4 mln in the full year 2016/17, but as result sales growth guidance for the medium term has been raised to 2-4% from 1-2%.