Desmond increases stake in Greencore

Financier Mr Dermot Desmond has increased his stake in foods group Greencore from 5.3 per cent to 6.2 per cent after paying €4.6 million (£3.6 million) for another 1.67 million shares. Mr Desmond purchased the shares at €2.78 each and now holds 11.6 million shares worth €33 million.

Mr Desmond's increased investment in Greencore will in evitably generate speculation on the future of the group, which is involved in sugar, flour, malt and fertiliser manufacture, as well as consumer foods in Britain where Greencore is expanding in the baking and pizza toppings business.

Greencore has recently disclosed that it had discussions with the British foods group Perkins Foods on a possible €300 million bid. However, after it emerged that Perkins was in discussion with a management buyout group on a bid at a lower price, Greencore cut its bid to the same price.

Perkins is involved in the manufacture and distribution of fresh and frozen foods, from sausages and burgers to frozen pizzas and pastry products. Analysts believe that Perkins - with sales last year of £388 million sterling (€634 million) - would be an ideal fit for Greencore.

Market sources believe Mr Desmond's presence on the Greencore share register is purely an investment and that he is unlikely to harbour any plans to become involved in redirecting the group, which has been criticised in some quarters for being too conservative when it comes to acquisitions and expansion.

While Mr Desmond and fellow financier Mr Pierce Casey did intervene directly in distribution group Unidare when they tried to block a takeover, Mr Desmond tends to invest and then take a profit. He occasionally re-invests in the same company at a lower price.

This was the strategy at foods group Golden Vale, where he built up a 8 per cent shareholding, sold it at a £4 million (€5.1 million) profit, and then bought back into Golden Vale to build up a 8.3 per cent stake.

Mr Desmond's investments in Irish public companies are negligible compared to the money he has generated from his investment in Esat Digifone and Baltimore Technologies.

Mr Desmond made €113 million last year when he sold 9 per cent of Esat Digifone to Esat Telecom and Telenor and made an estimated £25 million when he sold his remaining 1 per cent to BT as part of the eventual takeover of Esat Telecom.

He also sold £55 million sterling worth of Baltimore Technologies last year at a very large profit. His remaining stake in Baltimore has soared in value in recent months and is currently worth £160 million sterling.

He also has a 10 per cent stake in software group Datalex which is due to come to the stock market this year. He owns 19 per cent of Celtic football club and also owns London City Airport.