Morrison (wm) Supermarkets Takeover Rumours (MRW)


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"No interim dividend declared given offers from CD&R and Fortress" The exec appear to be fully committed to a takeover, the CD&R offer even allowed for interim dividends stating that they would just be deducted from the offer price.
LONDON (Reuters) - British supermarket group Morrisons on Thursday agreed a takeover offer worth 7.0 billion pounds ($9.54 billion) from U.S. private equity group Clayton, Dubilier & Rice (CD&R), dropping its recommendation of a lower bid from the Fortress-led consortium. Morrisons said CD&R's offer is worth 285 pence a share, trumping a 272 pence a share offer, worth 6.7 billion pounds, from a consortium led by Softbank owned Fortress Investment Group.
Morrisons board and the takeover panel would not have allowed more time to the private equity firm if they did not think it was going to come back with a higher offer, CD&R may have to offer at least 275p, although the City is deeming 280p more appropriate. Since takeover talks started, Silchester, has been trimming its stake and has made £5mln from 1.7mln shares sold at 282p.
"Talks to get the US investment giant Apollo on board to finance a bid to buy Morrisons have cooled after a shock increase in the offer price earlier this month. New York-based Apollo had been lined up to join a takeover consortium led by the private equity firm Fortress. But market sources this weekend said they believed Apollo had baulked at the dramatic £400million price increase for the supermarket chain. Fortress increased its offer from £6.3billion to £6.7billion nine days ago in a highly unusual pre-emptive strike to gazump its rival Clayton Dubilier & Rice, advised by former Tesco chief executive Sir Terry Leahy."
"Takeover of Morrisons backed by 2 influenctial investment advisers: Recommendations are expected to be delivered next wk."- This is Money, 7 Aug 2021 "It is understood that Clayton Dubilier & Rice, whose initial offer was rejected by the board in June, HAD BEEN CLOSE TO MAKING A BID ON FRI MORNING, but delays in the process allowed Fortress the opportunity to take the UNUSUAL step of raising its own offer in anticipation." --- A confirmation as to market chatter that CDR was going to make a bid which is history now but good to see it in print.
Daily Telegraph has just published a new article on Morissons plc takeover. Its via subscription but 2-3 paras are free to read. It came out at 7pm, Sat, 7 Aug 2021. Its on the other MRW forum. Its about Terry Leahry of Tesco fame.
This long termer, since safeway takeover, if not before, has sold out. Seems a toss up between slightly higher bid or falling back to tabled offer.
The bidder said the offer represents at 52% premium on the group's 178p per share price at the close before the first takeover proposal sparked surge in its valuation. The company said in a stock market statement: "Morrisons directors believe that the increased Fortress offer is in the best interests of Morrisons shareholders as a whole, and accordingly unanimously recommend that Morrisons shareholders vote in favour of the resolutions required to implement the increased Fortress offer." The UK takeover regulator has given CD&R a deadline of Monday 9 August to either place its own firm bid for the retailer or walk away.
BBC - Supermarket chain Morrisons says it has agreed to a revised takeover offer worth £6.7bn, up from £6.3bn, from a private equity consortium led by Fortress Investment Group. The increased offer, worth 272p a share, comes after some key investors rejected a previous 254p a share offer.
If the takeover speculation carries into next month MRW will be back in the FTSE100, currently #79 and bigger than J Sainsbury according to last Friday's rankings: htTp://
The Morrisons supermarket chain might have to break up if a planned £6.3billion takeover deal goes through. A sale of Morrisons to private equity owners could trigger a break-up of the supermarket chain, analysts in the City have warned. City analysts Bernstein said the new owners would need to sell off part of the supermarket to reclaim some cash. Bernstein said buyers would struggle to make a profit "without significant asset salesâ€￾. The shareholders, JO Hambro, Silchester and M&G own about 20% of Morrisons said the price wasn't high enough and had worries about how fast the sale was moving. Fortress needs 75% of Morrisons shareholders to agree for the deal to go through at a meeting due on 16 August.
Morrisons suitor CD&R poised to kick off bidding war - By Luke Tugby 2 August 2021: Morrisons is bracing itself for a counter takeover offer this week as shareholder opposition mounts against Fortress’ £6.3bn bid. Private equity giant Clayton, Dubilier & Rice (CD&R) is set to kick off a bidding war for the supermarket giant by submitting a counter offer, which could be lodged in the coming days.
Analysts have warned that British supermarket chain Morrisons could be broken up if it is taken over by buyout firms. Analysts at Bernstein said they “struggle to seeâ€￾ how Morrisons’ assets would not be stripped if the takeover proceeds at the current or a higher offer price. An increase in the price would “put further pressure on potential new owners to sell off additional assets — factories, warehouses and storesâ€￾.
Private equity firm Clayton, Dubilier & Rice (CD&R) is poised to come back with a new bid for Morrisons, stepping up a bidding war for the British supermarket chain, the Sunday Times reported. The Sunday Times said CD&R was understood to have been preparing equity and debt financing for a counter bid that could come in the next few days. If successful, CD&R would open Morrisons convenience stores at fuel stations operated by Motor Fuel Group, which CD&R owns, and it would work alongside the existing Morrisons’ management team, the Sunday Times said. Britain’s Takeover Panel, which regulates corporate transactions, said last month it had given CD&R until Aug. 9 to announce a firm intention to make an offer or walk away.
This deal is dead . Jo Hambro just announced it wont be backing it. L&G not intrested either
Singapore wealth fund joins Fortress-led consortium on £6.3bn Morrisons takeover Cambourne Life Investment, a subsidiary of GIC, has agreed to join Fortress Investment Group – alongside Canadian pension fund CPPIB and a subsidiary of US group Koch Industries – as an additional co-investor This would allow the consortium to sweeten its bid for Morrisons after the supermarket’s largest shareholder - Silchester International, which owns a 15.14% stake in the company - said on Tuesday that it was not inclined to support the bid. GIC, Singapore's sovereign wealth fund, holds around 0.21 per cent of the issued share capital of Morrisons.
Totally agree.The takeover will be bad for customers, staff and probably shareholders too in the long run.Does not matter what they say they only in it for the money.
Re nominee accounts, I'm with iWeb for my ISA and I voted online in (against...) the SKY takeover vote. Very straightforward, I'm assuming this will be the same. EDIT: actually, that SKY situation was different, not a scheme of arrangement, I held out for a while but finally accepted the offer online. I'm not sure now that I'll get a vote on MRW. EDIT: used the chat facility on the website to ask if I will get to vote and actually ended up voting (against), or at least having my instruction submitted, took 2 minutes. Not entirely convinced it will get counted though.
htTps:// 'Generally private equity investment in retail businesses that were once public are designed to strip assets out and increase profits before the business is flipped. 'Morrisons is asset-rich because it was a family-owned business and it has been undervalued. 'I do not think foreign investors are coming to Britain because it is a great place for investment – I think it is because they want to make money. The board should be rejecting the offer. They have turned over and had their tummies tickled too early.'
American private equity firm Clayton Dubilier & Rice (CDR) is understood to be in talks with JP Morgan, Goldman Sachs and BNP Paribas to finance a second bid to takeover Morrisons.
Still to be decided according to the Takeover Panel Disclosure Table (it automatically got extended due to the new offer) hxxps:// They've got till Day 53 according to the Code, as far as I can make out
Morrisons tries to soothe farmers’ fears over takeover Morrisons boss David Potts has told farmers commitments by its US buyer “carry genuine weightâ€￾ Morrisons is under mounting pressure to extract legally binding commitments from the US consortium behind a £9.5bn takeover that it will not damage the legacy of the supermarket’s founding family.
Ministers demand probe into £6.3bn Morrisons takeover: Fears over US buyer and the impact on UK's food supply chain
Morrisons defends its private equity takeover amid calls for Parliament to scrutinise the £6.3bn deal Morrisons last night sought to head off political opposition to a private equity takeover of the supermarket amid calls for Parliament to scrutinise the £6.3billion deal. In a letter to government ministers and MPs in constituencies where it is a top employer, the grocer claimed that buyout firm Fortress and its backers would be ‘good stewards’ of the business. It listed undertakings the consortium has given on pay, suppliers and properties, despite questions about how binding these will actually be and for how long.
Asset strippers took out Debenhams, Sold their properties, then rented them back to Debenhams.. Is Morrisons next on the hit list ? .. Morrisons own 80 percent of its properties Morrisons: Government seeks assurances over Fortress takeover bid
'Morrisons chief to be quizzed over £6.3bn takeover: Business secretary Kwasi Kwarteng seeks meeting with chairman'
LONDON, July 5 (Reuters) - Takeover proposals for British supermarket chain Morrisons are a commercial matter for the companies involved, a spokesman for Prime Minister Boris Johnson said on Monday. "It remains a commercial matter for individual businesses as to how they're structured and funded so it wouldn't be for me to comment on specific firms," the spokesman said when asked if the government had looked at possible intervention in any deal
Reuters.. Under UK takeover rules Fortress' offer effectively resets the clock for CD&R to clarify its intentions, with a previous date of July 17 extended to around the end of the month. The Takeover Panel is yet to announce the deadline by which Apollo must clarify its intentions. "254p now seems to be the likely minimum and we would not rule out the eventual price rising further," said analysts at Barclays.
(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.
"Critics drew attention to the track record of Morrisons’ new bidders. Charles Koch and his late brother David sparked anger in 2010 after pumping more than £700,000 into a campaign to repeal California’s climate change laws. The family’s foundation, which invests in property, has also funded pushes to evict tenants from their homes during the pandemic. Meanwhile, CPPIB refused to back an agreement between shopping centre business Intu and its lenders to give it breathing room on its debt last year. The fears for Morrisons come amid a wave of takeover attempts for British businesses by private equity firms."
Morrisons shares expected to surge as private equity groups circle At least three groups thought to be looking at grocer, which has accepted a takeover bid from Fortress HTTPS://
Under British takeover rules CD&R has until July 17 to come back with a firm offer. CD&R declined to comment. Reuters
Don't sell your jewel @ cheaper rate to America Where new business are listing @ billion dollar and ours established company they want cheaper prices?They can't make fool too British company.Shorting reduced the price and then give 30% premium for takeover
Fortress's swoop on Morrisons could open a full-blown a bidding war for the supermarket if CD&R returns with a better offer. CD&R - which is advised by Sir Terry Leahy, the former Tesco boss - has until July 17 to make a firm offer for the retailer.
Morrisons has agreed to a takeover offer from the global investment manager Fortress Investment Group, which values the British supermarket group at £6.3bn. The bid is backed by a unit of Koch Industries and Canadian pension fund CPPIB. Under the terms of the deal, Morrisons shareholders will receive 254p a share, comprising 252p in cash and a 2p cash dividend. Andrew Higginson, Morrisons chairman, said: “We have looked very carefully at Fortress’ approach, their plans for the business and their overall suitability as an owner of a unique British food-maker and shopkeeper with over 110,000 colleagues and an important role in British food production and farming.â€￾ He added: “It’s clear to us that Fortress has a full understanding and appreciation of the fundamental character of Morrisons.â€￾
Reading between the lines I wonder if the board are actually keen to sell now, perhaps due to gathering interest, but couldn't PR-wise accept a kick-off from asset-strippers. This offer is at least politically presentable. htTps:// “We have looked very carefully at Fortress’ approach, their plans for the business and their overall suitability as an owner of a unique British food-maker and shopkeeper with over 110,000 colleagues and an important role in British food production and farming.â€￾ He added: “It’s clear to us that Fortress has a full understanding and appreciation of the fundamental character of Morrisons.â€￾
MPs wade into the Morrisons takeover row, asking regulators whether they may be able to intervene
1Madasafish. When there is a potential takeover, all the major investors in that company have to declare their holdings / shorts.
£2,70 still to low. Any successful bidder must pay 3 pounds minimum before the board starts entering into possible takeover negotiations otherwise they should just jog on.
Financial Mail on Sunday A takeover of Morrisons could see the supermarket giant shift offshore for tax reasons, experts fear. The grocer is bracing itself for a fresh offer from US group Clayton, Dubilier & Rice (CD&R) after an initial £5.5billion bid was rejected last week. But it is feared that a private equity buyout could see Morrisons' tax base shifted out of the UK.
They're busy people ;-) In corporate news, UDG Healthcare (UDG) edged up 1% to £10.56 as US private equity firm Clayton, Dubilier & Rice said it is mulling an improved and final takeover offer for the healthcare services group at £10.80 per share. HTTPS://
'Farmers plead for continued support if Morrisons changes hands' National Farmers Union says it will keep watch over any potential takeover of Britain's fourth-biggest supermarket chain
A takeover can take many twists and turns. Worst scenario is there is no further bid, and CDR announce no further interest, SP reverts to pre-bid levels. Mid scenario is CDR revert with a higher bid - perhaps around 250-260p? Again, likely to be rejected but most likely SP would follow the bid. Best scenario is bidding war - eg, Amazon decide to buy up Morrisons. All of a sudden, we're in £4 territory. I'd bet a fiver that the Amazon board is considering. Logistics already half up. It would be a revolution in shopping as Amazon bring their cashless/cardless model to the UK high street! And bring in even more customers. And can you imagine what they could do with the data they collect - and how they could tailor each supermarket to the individual needs of every single individual customer. They'd essentially beat every other supermarket hands down and take over UK supermarket retailing.
Predators told to raise their bid for Morrisons as political backlash against the private equity takeover begins City brokers yesterday said the private equity firm would have to dramatically raise the stakes if it is serious about buying Morrisons. They said the supermarket’s board, led by chairman Andy Higginson, was unlikely to negotiate unless the bid was upped to at least 280p a share.
Takeover target Morrisons has seen recent shopper spend fall from a year earlier when customers went on bumper buying sprees at the start of the pandemic, but the figure is still much higher than pre-Covid. Data from market research firm Kantar shows some of the features that might make the grocery chain look attractive to private equity group Clayton, Dubilier & Rice. The suitor recently proposed a 230p per share offer which has been rejected. In the 12 weeks to June 13 £3.1 billion was spent at Morrisons. That is down 1.5% year on year, but 8.9% higher than the same period in 2019. The grocer’s market share was flat at 10.1%. Rivals Tesco, Sainsbury’s and Asda all recorded improved market share versus the same time last year.
'Takeover target Morrisons saw recent sales lower than last year, but much higher than pre-Covid levels' HTTPS://
"The takeover has many parallels with the recent acquisition of UK grocer Asda by forecourt operator EG Group," analysts at Berenberg noted. In October, EG Group and private equity backers TDR Capital agreed a deal to take control of the UK supermarket chain from US retailer Walmart. "With press articles indicating that CD&R is still set to pursue the UK grocer, another offer is likely in our view," the German bank added. Alliance News
Executives at Morrisons stand to receive multi-million pound payouts if a private equity takeover of the supermarket succeeds. The grocer has rejected the £5.5billion bid because it was too low. Under that offer, chief executive David Potts could have been handed nearly £18million for his stock in the company. This includes 3 million shares he owns outright and another 4.6 million he could receive under various company schemes. Operating chief Trevor Strain could have made £10million and finance boss Michael Gleeson £3million. While Andy Higginson, chairman of Morrisons, could have bagged £291,000 for the shares he owns. The four men all stand to receive even more if CD&R comes back with a higher offer. Mr Potts, who was awarded a CBE in 2013, received £4.2million last year, including his £850,000 salary and a £1.7million bonus.
CD&R's confirmation that they will pursue the takeover regardless of the boards rejection shows a bid closer to 10bln could be the end result. Therefore, 230p is more than realistic for this morning. I see this going to around 290p prior to any takeover.
Amazon, a partner to Morrison, has persistently been linked to a possible bid. It has also been suggested that former Asda suitors Apollo Global Management and Lone Star could return with a bid for another supermarket after failing to acquire the Leeds-based group last year. Shares in other supermarkets, including Sainsbury's where 'Czech Sphinx' billionaire Daniel Kretinsky has a 10 per cent stake, are likely to rise tomorrow on the news.
The U.S. firm has until July 17 to make a formal bid under British takeover rules, CD&R said in a statement. Morrison shareholders would receive the second-half dividend of 5.11 a share under CD&R’s plan Bloomberg
"Buyout giant CD&R weighs £5bn takeover of supermarket chain Morrisons". Laughable BS!
'the past is the past, the longer the share price languishes, the more it's a likely an activist will come in and demand changes to get the price up. the asda takeover has highlighted how it is ideally suited to being bought out by a private equity company, and if they don't sort it out some of them may be out of a job soon.' shame i didn't act upon this !
Yes johncasey the typical takeover premium is at least 30%.
A large 5.7% short position needs closing Monday whatever happens. Board needs to hold out for more. Blackrock burnt here as 2.3% short position. Foolish as takeover was always probable.
Shorters dropping this into the close. Trading around book price now. £200M of Covid costs was bang out of order and I would have sacked the CEO for this alone. This is a PLC not a charity. I do see MRW receiving a takeover offer, if it hasn't already..., within the next 12 months or so. Large freehold property portfolio. Probably won't be Amazon like most suspect but regardless take over price will be around £3. Dividend of 4-5% in the meantime.
the private equity owners of asda were able to borrow almost £4bn at 3.3% interest to fund their bid. they also sold and leased back the distribution centres for proceeds of £0.95bn. asda has about £9bn of freehold property if the media are to be believed. morrisons has property in the books at £5.8bn, with a much higher %age freehold than asda. now that the space race is over, capital is being used to pay down debt and this is making it more and more likely it will be taken over. there is also a very substantial manufacturing business that could be sold. this is a play on UK property, and even if there is no takeover, i think this is a very low risk 6-7% yielding share with excellent asset backing that is in huge demand from the institutions.
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