26th Mar 2015 14:29
LONDON (Alliance News) - Kingfisher PLC Thursday admitted its efforts to acquire Mr Bricolage are under threat, saying it's considering all its options after the French company and one of its key shareholders told the British company that the undertakings needed to get the deal past competition regulators were "no longer in their interests".
Kingfisher went into exclusive negotiations in April last year to acquire Mr Bricolage for EUR275 million. Under the terms of the proposed deal, it was to acquire a 41.9% stake from from ANPF, which is held by franchisees, and 26.2% from the Tabur Family, at an agreed price per share of EUR15. It would then make a mandatory offer to the minority shareholders.
However, on Monday, Mr Bricolage shares were suspended in Paris pending a statement, and on Tuesday Kingfisher said the French company's board and ANPF now had reservations about the deal, although the Tabur family was still backing it.
In its statement on Wednesday, the owner of DIY chains like B&Q and Screwfix said it had been working very closely with Mr Bricolage, the ANPF, the Tabur family, and the French competition authority.
"At a late stage Mr Bricolage and the ANPF indicated that the undertakings in France required to obtain the competition clearance were no longer in their interests. Without the consent of Mr Bricolage and the ANPF, the competition clearance undertakings necessary to finalise the transaction cannot be given," Kingfisher said.
The deal was under scrutiny from the French antitrust regulator, which was apparently demanding undertakings before it would allow it to go ahead, because Kingfisher already has 113 Brico Dépôt and 103 Castorama stores in France. Mr Bricolage has about 797 shops under its banner in France, including several hundred franchise outlets.
Kingfisher's sales in France declined 9.3% in the third quarter of its recently-ended financial year, while profit in the country fell to GBP120 million, from GBP140 million a year earlier. It blamed the weak French economy for the decline.
Kingfisher shares were down 1.7% at 358.00 pence Thursday afternoon.
By Steve McGrath; [email protected]; @stevemcgrath1
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