The cereal industry has been struggling since the ever growing competition from different popular options such as yogurts and smoothies. On Friday, Post Holdings, Associated British Foods and two other cereal companies are bidding over British cereal brand Weetabix. Weetabix could be acquired for roughly $1.88 billion, based on a valuation of more than 11 times of the company’s earnings.
According to Reuters, Weetabix, owned by China’s Bright Food, has also attracted interest from Cereal Partners Worldwide, a joint venture between Nestle and General Mills and Italian pasta maker Barilla, the sources said. The parties are working to put the finishing touches to their offers which are due in next week, said the sources, who declined to be identified as the matter is private. Weetabix, ABF, and Nestle declined to comment, while Bright Foods, Post, Barilla and General Mills were not immediately available. The bidders have been asked to submit non-binding offers ahead of a deadline of next week, the sources said, adding that private equity investors had not been invited to the process as they would struggle to compete against industry players who can reap synergies from the combination.