Bulmer takeover talks have lost their fizz

Takeover talks at HP Bulmer, the beleaguered owner of Strongbow, Woodpecker and Scrumpy Jack cider, are understood to have stalled after a disagreement over its value.

The cider-maker effectively put itself up for sale in January after a series of profits warnings and the discovery last year of a black hole in its accounts. The group must also meet a July deadline to refinance £130m of debt to stay in business.

Under its new chief executive, Miles Templeman, it is considering options such as an outright takeover, the sale of its drinks distribution arm The Beer Seller or refinancing through an emergency rights issue. It has invited bids from several industry names, and talks are understood to have been held with brewing giants Scottish & Newcastle, Carlsberg-Tetley, Interbrew and SABMiller. Private equity house CVC Capital Partners is also understood to have been in talks with the group.

But the talks have stalled after a surge in the group's share price, which has risen from 166.5p on 16 March to close last Friday at 225p, giving it a market value of £119m. Last year, the stock sunk as low as 73.5p. The takeover approaches are thought to have been closer to 200p and the group, which is 51 per cent owned by around 144 members of the Bulmer family, is believed to have asked the potential bidders to go away and reconsider. But a City insider says: "The majority have just gone away. Valuations are way too high."

Mr Templeman was named chief executive in January, replacing former incumbent Mike Hughes, who quit in September. A new finance director, Richard Pennycook, has also been brought in.

Bulmer, which distributes Red Stripe Jamaican lager and Amstel, made an unsuccessful foray into international markets and misjudged its launch of "cocktail" products.