UPDATE: Morrisons agrees to £7bn takeover deal by CD&R

Morrisons has agreed to a £7bn takeover by Clayton, Dubilier & Rice, which increased its offer for a takeover of the supermarket chain.

Morrisons’ share price surged 4.5%. Earlier, CD&R had made an offer of 230p a share, which valued Morrisons at £5.5bn, but this was rejected for undervaluing the retailer. It has now upped its offer to 285p.

Morrisons has accepted the latest offer, which beats competitor bidder Fortress Investment Group.

Earlier this month Fortress had also raised its bid – to 270p per share, plus a special dividend of 2p. The bid valued the supermarket group at £6.7bn.

“The Morrisons board believes that the offer from CD&R represents good value for shareholders while at the same time protecting the fundamental character of Morrisons for all stakeholders,” said Andrew Higginson, chair of Morrisons, in a statement released by CD&R.

 

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“CD&R have a strong record of developing, strengthening, and growing the businesses that they invest in and they share our vision for Morrisons’ future,” he added.

“This, together with the strong set of intentions that they have set out today, gives the Morrisons Board confidence that CD&R will be a responsible, thoughtful and careful owner of an important British grocery business.”

Sir Terry Leahy, senior adviser to CD&R funds, said: “The grocery sector in the UK is undergoing great change and we believe Morrisons is well placed, with CD&R’s support, to succeed in this environment.”

Source: Yahoo News

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