CD&R wins $10 billion auction for UK supermarket Morrisons

October 2, 2021

LONDON (Reuters) – Clayton, Dubilier & Rice (CD&R) has won the auction for Britain’s Morrisons with a 7 billion pound ($9.5 billion) bid, paving the way for the U.S. private equity firm to take control of the UK’s fourth biggest supermarket group.

The Takeover Panel, which governs M&A deals in the UK and arranged the auction, said on Saturday CD&R had offered 287 pence a share, while a consortium led by the Softbank owned Fortress Investment Group offered 286 pence.

CD&R’s victory marks a triumphant return to the UK grocery sector for Terry Leahy, the former chief executive of Britain’s biggest supermarket chain Tesco, who is a senior adviser to the firm.

CD&R’s auction offer is only slightly higher than the 285 pence a share offer that was recommended by Morrisons’ board in August.

Morrisons’ board, which will meet on Saturday, is now expected to recommend shareholders accept the new offer at a shareholder meeting slated for Oct. 19.

If shareholders approve the offer CD&R could complete its takeover of Morrisons by the end of the month, the second UK supermarket chain in a year to be acquired by private equity after a buyout of no.3 player Asda completed in February.

($1 = 0.7383 pounds)

(Reporting by Sarah Young and James Davey; Editing by Kate Holton)

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