Dalgety surprised the market yesterday when it disposed of its key petfoods business, and proposed returning a total £650 million sterling to its shareholders.

It is selling Spillers Petfoods, which has 25 per cent of the European market with brand names such as Felix and Winalot, to Switzerland's Nestle, the world's biggest food company, for £715 million in cash.

Dalgety also sold Martin-Brower - the largest distributor to McDonalds Corp - - to the US privately-owned Reyes Holdings for £120 million in cash. It said McDonalds had played a "full and constructive" role during the negotiations.

Last week, it sold its Dalgety Food Ingredients business to Kerry Group for £335 million.