Stalker circles battling Big Food

ICELANDIC corporate raider Baugur is waiting on this week's results from Big Food Group before making a decision on whether to bid for the company.

Baugur owns 23% of BFG, which runs the struggling Iceland frozen food chain, along with wholesaler Bookers and a logistics operation. It has previously said it had no immediate plans to bid for BFG.

Under takeover rules, Baugur has been barred from moving on BFG for the past six months after its statement last October that it would not make a bid. It has been free of that restriction since last month - which conveniently coincides with the publication of BFG's final results on Wednesday.

BFG is expected to post a slump in pre-tax profits from £42.9m in 2002 to about £31.5m this year. Its last quarter trading statement issued last month showed sales declining at 3.6% against 2.9% in the previous quarter, and some analysts predict pre-tax profits could fall to £28m.

Baugur will also be watching to see how the next generation of Iceland stores, on which chief executive Bill Grimsey has staked the future of the brand, are performing.

Baugur chief executive Jon Asgeir Johannesson has been scathing about the new stores and the drive to take the chain upmarket.

The Reykjavik-based group has built up holdings in a number of undervalued British retailers recently, including stakes in House of Fraser, Somerfield, Mothercare and Selfridges.