Heinz looking to sell Tegel poultry division

US food giant Heinz said yesterday it was in "advanced talks" to sell New Zealand's Tegel poultry business.

The Chicago-based Heinz made the comment when it released its second quarter results yesterday.

Heinz reported a profit of US$203.8 million ($299.5 million), or 60 cents share, for the second quarter ended October 26, up from US$199.0 million, or 56 cents a share, a year earlier.

Volume, a measure of units sold that factors out currency and price fluctuations, rose only 0.6 per cent, weighed down by declines in Tegel, as well as dips in Europe and the US food-service segment.

Tegel's sales have fallen since it lost New Zealand's biggest chicken contract, to supply KFC fast food outlets.

The Australian newspaper last week reported that bird flu fears had thrown the sale of Tegel into disarray. The paper said the two final bidders, Ironbridge Capital and Pacific Equity Partners, had made lower than expected bids on the back of fears of the impact of a potential bird flu outbreak.

As well as trying to offload Tegel, Heinz is in the process of trying to sell its European seafood and frozen food operations as it looks to improve profit in that region, after completing a similar restructuring in its US business.

Heinz bought Tegel in 1992 as part of the acquisition of Goodman Fielder, which also included Wattie's and Tip Top Ice Cream.

- NZPA