Morrisons rejects conditional £5.5 billion takeover proposal
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Morrisons has rejected a £5.5 billion takeover bid from a private equity firm, believing it would have “significantly undervalued” the company.
Clayton, Dubilier & Rice (CD&R) earlier said it noted the press speculation regarding a potential transaction involving Morrisons and confirmed that it was “considering a possible cash offer”.
CD&R, which has until July 17 to announce a firm intention to make an offer under UK takeover rules, added in a statement that there can be “no certainty an offer will be made”.
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
Morrisons said it rejected a conditional cash offer from CD&R of 230 pence per share – which amounts to just over £5.5 billion.
In a statement, the supermarket chain said: “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.
“Accordingly, the board rejected the conditional proposal on 17 June 2021.”
Last month, Morrisons said sales in the 14 weeks to May 9 grew 2.7% on a like-for-like basis, excluding fuel, including a 113% jump in online sales.
But before the easing of lockdown, the supermarket said it had to spend an extra £27 million in Covid-19 costs during the past three months to cover for staff absences and store marshals.
