By Samantha Machado
(Reuters) – Bisto gravy and Oxo cube maker Premier Foods <PFD.L> named its UK business chief Alex Whitehouse as its new CEO on Friday, handing him the task of reviving the company which has been under pressure since a failed takeover bid three years ago.
The company also said it had hired Colin Day from Reckitt Benckiser <RB.L>, where he was CFO, to be its new chairman, and appointed a new finance chief, filling a leadership void at the group.
Whitehouse was credited with turning around Premier Food’s UK business, including a relaunch of the Mr Kipling cake brand, which has outperformed the rest of the group. He replaces Gavin Darby, who stepped down in January after facing pressure from hedge fund Oasis Management for failing to halt a share price slide since Premier Foods rejected a twice-improved takeover offer in April 2016 from U.S. food maker McCormick <MKC.N>.
Premier Foods said in February it would review options to boost shareholder value after talks with its top investors.
The company’s shares were up 2.5% at 33.80 pence by 0739 GMT after news of the appointments. They are still well below the 65 pence per share offer made by McCormick in 2016.
“Traders view it as the beginning of the new era of management, but until a plan is mapped out, some dealers are likely to remain cautious”, CMC Markets Analyst David Madden said, adding that Oasis will be keeping a close eye.
“If the share price continues to muddle along, the firm might apply pressure to the food group again.”
The company also named Duncan Leggett, director of financial control and corporate development, as finance chief. Alastair Murray, who has been acting CEO since February and CFO for six years, will step down after a “mutual decision” with the board, a spokeswoman for the company said.
Whitehouse, joined Premier Foods in 2014 after holding executive roles at consumer and retail firms including Whitbread <WTB.L>.
“Alex Whitehouse has presided over a marked turnaround of performance in PFD’s UK business, reflected in eight consecutive quarters of growth in the core branded business”, Jefferies analysts said in a note.
Day, who has held key positions at engineering company Meggitt <MGGT.L> and world’s biggest advertising agency WPP <WPP.L>, replaces Chairman Keith Hamill who had announced plans to retire in May.
(GRAPHIC – Premier Foods lags FTSE smallcap index since takeover plans fell through: https://fingfx.thomsonreuters.com/gfx/mkt/12/5439/5389/PREMIER%20FOODS.png)
(Reporting by Samantha Machado and Muvija M in Bengaluru; Editing by Arun Koyyur and Susan Fenton)