LONDON, Oct 19 (Reuters) - Shareholders in supermarket group
Morrisons are expected on Tuesday to approve a 7 billion
pound ($9.6 billion) offer by U.S. private equity firm Clayton,
Dubilier & Rice (CD&R), bringing the curtain down on Britain's
most fiercely contested takeover this year.
CD&R, which has former Tesco boss Terry Leahy as a
senior adviser, won an auction for Morrisons on Oct. 2, bidding
a penny a share more than a consortium led by Softbank
owned Fortress Investment Group.
Investor approval for the deal will conclude a six-month
battle to buy Morrisons, Britain's fourth-biggest grocer and one
of the country's biggest food producers.
It will end Morrisons' 54-year run as a publicly listed
company and see the ultimate decisions on the group's future
shift from its Bradford, northern England, base to the New York
home of CD&R.
Morrisons, which started out as an egg and butter merchant
in 1899, trails market leader Tesco, Sainsbury's and
Asda in annual revenue.
The battle for Morrisons has been the most high-profile amid
a raft of bids for British companies this year, reflecting
private equity's appetite for cash-generating UK assets.
With the winning bid representing a hefty 61% premium on
Morrisons' share price before takeover interest publicly emerged
in mid-June, analysts expect little or no dissent.
To go through CD&R's offer needs the support of shareholders
representing at least 75% in value of voting investors at the
meeting, which is being held both physically and virtually.
CD&R has committed to retaining Morrisons' Bradford
headquarters and its existing management team, led by CEO David
Potts.
It has also said it will execute the supermarket chain's
existing strategy, not sell its freehold store estate and
maintain staff pay rates.
These commitments are not legally binding, however.
If, as expected, shareholders approve the offer, CD&R could
complete its takeover by the end of the month, making Morrisons
the second UK supermarket chain in a year to be acquired by
private equity after a buyout of No. 3 player Asda, by the Issa
brothers and TDR Capital, completed in February.
($1 = 0.7284 pounds)
(Reporting by James Davey; Editing by Susan Fenton)
