 "UK's Morrisons rejects $7.6 billion takeover proposal from CD&R")
British supermarket group Morrisons has rejected a proposed 5.52 billion pound ($7.62 billion) cash offer from US private equity firm Clayton, Dubilier & Rice (CD&R), saying it is far too low.
Britain’s fourth largest grocer by sales after Tesco, Sainsbury’s and Asda, said it received the “unsolicited, highly conditional non-binding” proposal of 230 pence a share on Monday.
The board of Bradford, northern England-based Morrisons rejected the proposal on Thursday.
“The board of Morrisons evaluated the conditional proposal together with its financial adviser, Rothschild & Co, and unanimously concluded that the conditional proposal significantly undervalued Morrisons and its future prospects,” the group said in a statement on Saturday.
Shares in Morrisons, down 5.5 per cent over the last year, closed on Friday at 182 pence, valuing the group at 4.33 billion pounds.
Morrisons said CD&R’s proposal provided for Morrisons shareholders to also still receive a final ordinary dividend of 5.11 pence per share announced on March 11.
CD&R had earlier on Saturday said it was considering a possible cash offer for Morrisons.
Under British takeover rules CD&R has until July 17 to announce a firm intention to make an offer.
CD&R’s approach underlines private equity’s growing appetite for UK supermarket assets, attracted by their cash generation and freehold assets.
Britain’s fourth largest grocer by sales after Tesco, Sainsbury’s and Asda, said it received the “unsolicited, highly conditional non-binding” proposal of 230 pence a share on Monday.
The board of Bradford, northern England-based Morrisons rejected the proposal on Thursday.
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Shares in Morrisons, down 5.5 per cent over the last year, closed on Friday at 182 pence, valuing the group at 4.33 billion pounds.
Morrisons said CD&R’s proposal provided for Morrisons shareholders to also still receive a final ordinary dividend of 5.11 pence per share announced on March 11.
CD&R had earlier on Saturday said it was considering a possible cash offer for Morrisons.
Under British takeover rules CD&R has until July 17 to announce a firm intention to make an offer.
CD&R’s approach underlines private equity’s growing appetite for UK supermarket assets, attracted by their cash generation and freehold assets.
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