5th Jul 2021 08:03
(Alliance News) - Wm Morrison Supermarkets PLC received takeover interest from a third private equity group on Monday, with Apollo Global Management Inc the latest to size up the Bradford-based grocer.
Apollo's declaration of interest comes after Morrisons on Saturday accepted a takeover offer from a consortium of investment groups, following its rejection of another private equity bid last month.
New-York based Apollo said it is mulling making a possible offer for FTSE 250-listed Morrisons, but is yet to make a formal approach.
"No approach has been made to the board of Morrisons. There can be no certainty that any offer will be made, nor as to the terms on which any such offer might be made," Apollo said on Monday.
Morrisons has agreed to a takeover by a group of investors comprising Softbank Group Corp-owned Fortress, Canada Pension Plan Investment Board and Koch Real Estate Investments.
Under the GBP6.3 billion deal, the group will pay 252 pence per share plus a 2p special dividend. The stock closed at 239.80p on Friday in London, valuing the company at GBP5.78 billion.
According to the announcement, the deal also includes GBP3.2 billion in debt, which makes the total operation worth GBP9.5 billion with debt recovery.
Andrew Higginson, chair of the chain which employs 110,000 people at 500 outlets, said directors believed the offer represented "a fair and recommendable price for shareholders which recognises Morrisons' future prospects".
"Fortress, CPP Investments and KREI all have strong track records and a long-term approach to investing. They are backing our strategy, our management and our people," he added.
Morrisons rejected a GBP5.5 billion offer in June from Clayton Dubilier & Rice that sent the chain's share prices soaring – but which Morrisons ultimately said was too low.
McColl's Retail Group PLC, meanwhile, said its wholesale supply agreement with Morrisons will be unaffected by any change in ownership.
"McColl's extended its wholesale supply contract with Morrisons in February 2021 by a further three years to January 2027, providing the business with even greater access to Morrisons' grocery expertise and brand. This contract will not be affected by any potential changes in the ownership of Morrisons," McColl's added.
"The company's focus remains firmly on maximising efficiency in its wholesale supply arrangements and the successful rollout of Morrisons Daily conversions across the estate. McColl's looks forward to continuing to build on the strong relationship developed with Morrisons over the years to serve our local neighbourhood communities with a high quality convenience offer."
By Eric Cunha; [email protected]
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