McCormick ends bid for Premier Foods

Spice maker McCormick & Co. is dropping its bid to acquire U.K.-based Premier Foods, saying the price tag for the sauce and dessert company became too high.

The Sparks, Md., headquartered McCormick had sought to buy the company, known for products such as its OXO bouillon cubes and Mr. Kipling dessert cakes, for about $764 million in cash.

McCormick, which began its purchase attempt in February, had recently increased its original offer by about $60 million. But "after careful consideration, concluded that it would not be able to propose a price that would be recommended by the Board of Premier Foods while also delivering appropriate returns for McCormick shareholders," the company said Wednesday.

Amid McCormick's bid, Japanese food company Nissin acquired a 17% stake in Premier Foods. "The Board appreciates the open and constructive spirit in which the engagement with McCormick was conducted," Premier's board of directors said in a statement Wednesday. "The Board also considers that the Company's longer-term prospects will be enhanced by the Co-Operation Agreement it has signed with Nissin Foods Holdings Co., Ltd. which will expand Premier Foods’ range of growth opportunities."

McCormick (MKC) shares were down 1.7% Wednesday to $97.25, while Premier Food shares plummeted 24% to $43.16.

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