Italy's Barilla makes bid for bakery

FRANKFURT, Germany (Reuters) - Italy's Barilla, the world's largest pasta producer, said on Monday it would make a 993.6 million euros ($875 million) bid to buy Germany's largest bakery chain Kamps.

A Barilla-linked vehicle, Ffynnon Vierundzwanzigste Vermoegensverwaltungs, said in a statement it was bidding 12 euros per share for Kamps, a premium of 11.3 percent over Kamps's Friday close of 10.78 euros.

The stock jumped to just above the bid price of 12 euros immediately after the market opened, trading up 1.25 euros, or 11.6 percent, at 12.03 euros at 0726 GMT.

It was not immediately clear whether the bid had been agreed with the management of Kamps, which declined to comment.

Barilla said an official statement would be made later on Monday.

"The offer has been in the market for several months, but the price is not particularly high (from a shareholder's perspective)," one Frankfurt trader said, adding there was no reason for shareholders to accept the offer.

Last November, Guido Barilla, chairman of the family-owned pasta maker based in Parma, told Reuters he was looking for possible acquisitions. Kamps Chief Executive Heiner Kamps said in February he did not rule out a deal with Barilla.

Kamps has said it aims to cut its 751 million euro debt load by 60 million this year and by 90 million next year. In 2001 it posted sales of 1.7 billion euros and an adjusted net income of 20.2 million. It also slashed debts by 54 million.

Kamps has a price to earnings ratio, a measure that gives investors an idea of how much they are paying for a company's earning power, of 44.9 according to Reuters data.

Barilla, which is a large player on the durum wheat market, last year divided into units for bakery products and products like pasta and sources. Guido Barilla said the firm's growth in its two main product areas was based on acquisitions.

Barilla took part in a bid to buy U.S. cookie and cracker maker Keebler in 2001, but that deal was won by cereal giant Kellogg Co.