Italy's Newlat halts talks to buy UK food group Princes

MILAN (Reuters) - Italy's Newlat said on Friday it had halted talks to buy British food group Princes as Japanese seller Mitsubishi Corp rejected a revised proposal for the asset.

Sky News reported in December that British buyout firm Epiris and Newlat were competing to purchase Princes, with Mitsubishi seeking a price of 400 million pounds ($504 million).

Newlat said on Friday it had submitted a new proposal for Princes to take into account lower demand and price dynamics in a challenging UK market.

Newlat, which operates in sectors including pasta, milk and dairy, added that it remained open to a transaction should Princes' owner change its mind on its latest proposal.

Princes sells tinned fruit and fish under its own name brand, and other products such as Flora sunflower oil and the Napolina range of Italian-style tomato sauces.

It traces its roots to 1880, when it was founded as a fish importer in Liverpool, the northern English city where it retains its international headquarters. It has been owned by Mitsubishi since 1989.

($1 = 0.7938 pounds)

(Reporting by Elvira Pollina, editing by Alvise Armellini, Kirsten Donovan)