Lion Capital will retain part of its stake in Findus having foiled an attempt by rival Triton Partners to seize the struggling business by allying itself with the frozen foodmaker’s banks.

Lion and Triton, both private equity groups, have been locked in a battle over the control of the debt-laden Findus, which operates in France, Scandinavia and the UK, where it owns the Young’s Seafood brand.

Triton, which specialises in northern European buyouts, had hoped to prise the business from Lion, which bought Findus for £1.1bn in 2008 after lacklustre performance and unmanageable debt led to a breach of banking covenants.

Its plans to convince the company’s senior lenders, which include Société Générale, Nordea and Royal Bank of Scotland, to seize control of the business and hand it to Triton for about £300m were ultimately rejected by the banks in a decisive vote on Friday.

Instead, the senior lenders allowed Lion, which owns some of the junior debt as well as the company’s equity, to pump in £150m of capital alongside other creditors to retain control of the food group.

The agreement amounts to Findus being partly taken over by the holders of its mezzanine debt, the riskiest and least secured tranche of a company’s capital, whereas Triton had hoped more senior creditors would swoop on the company.

Lion will retain about a one-third stake in Findus, with Highbridge Capital and JPMorgan Chase jointly owning about half of Findus in exchange for £70m of their debt being written off.

Triton had offered to pay down Findus’s nearly £800m net debt, but wipe out the mezzanine investors as well as Lion’s equity, to reflect the poor state of the business. Lion had originally offered £100m of fresh capital in order to appease Findus’s banks, but had to sweeten its offer after Triton’s bid.

Findus has been hit by a rise in raw material prices, unable to pass on extra costs to price-sensitive consumers in the current economic environment. As a result, its earnings before interest, tax, depreciation and amortisation are only about half the £180m in Lion’s business plan.

Though putting up less money, it had warned bankers that ousting it as the biggest shareholder would take up to six months, which would potentially stretch the patience of Findus’s creditors and threaten the viability of the company.

People close to the situation said that Lion had dangled to lenders the prospect of selling better-performing parts of the business to generate cash quickly.

In particular, it has advanced the possibility of some disposals to Permira, its buyout rival, which owns the Birds Eye Iglo, a rival to Findus. Permira has been trying to offload Iglo, but a recent joint bid from Blackstone and BC Partners came in below its asking price of €2.8bn.

People close to the Triton bid said that the Lion offer contained uncertainty, which could lead to its own proposal ultimately coming through.

All parties declined to comment.

Get alerts on Findus Group Ltd when a new story is published

Copyright The Financial Times Limited 2018. All rights reserved.

Follow the topics in this article