* CD&R won Oct. 2 auction for supermarket group
* Deal expected to complete on Oct. 27
(Adds detail)
By James Davey
LONDON, Oct 19 (Reuters) - Shareholders in supermarket group
Morrisons on Tuesday approved a 7 billion pound ($9.7 billion)
offer from U.S. private equity firm Clayton, Dubilier & Rice
(CD&R), bringing the curtain down on Britain's most fiercely
contested takeover this year.
Morrisons said the requisite majorities of
shareholders backed the deal, which had been recommended by the
board, at meetings held both physically at its Bradford,
northern England headquarters and virtually.
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.
CD&R's winning bid of 287 pence a share represented a hefty
61% premium on Morrisons' share price before takeover interest
publicly emerged in mid-June.
Formal completion of the deal, expected on Oct. 27, 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 Bradford 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.
CD&R has committed to retaining Morrisons' Bradford base 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.
Those commitments are not legally binding, however.
"We are very pleased to have received the approval of
shareholders and are excited at the opportunity that lies
ahead," said Leahy, who is expected to succeed Andrew Higginson
as Morrisons' chairman.
"The particular heritage, culture and operating model of
Morrisons are key features of the company and we will be very
mindful of these during our tenure as owners."
Morrisons is 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.
Potts, who started his retail career at Tesco as a
16-year-old shelf stacker, will make more than 10 million pounds
from selling his Morrisons shares to CD&R. Chief Operating
Officer Trevor Strain will pocket about 4 million pounds.
($1 = 0.7245 pounds)
(Reporting by James Davey; editing by Costas Pitas and Emelia
Sithole-Matarise)
