(Alliance News) - Wm Morrison Supermarkets on Wednesday said it has begun talks with the Takeover Panel over the prospect of arranging an auction resolve the bidding battle for the Bradford-based supermarket chain.
Clayton, Dubilier & Rice and Softbank Group Corp-owned Fortress are the two suitors in the running to acquire the company, though Morrisons noted that neither have made final offers.
"Following completion of the auction procedure, the Morrisons board anticipates proceeding with either the Fortress meetings or the CD&R meetings depending on which offer it is recommending to Morrisons shareholders," the company added.
At the start of July, it agreed a GBP6.3 billion deal from a consortium of investment groups which included Fortress.
This sparked a bidding war. On August 6, Fortress increased its offer to 272 pence, plus a special 2p dividend for each Morrisons' share. This was followed by an all cash offer from CD&R, valued at 285p per share.
Most recently, Morrisons accepted a GBP7.0 billion takeover offer from CD&R, which aimed to win minds with the increased bid, and hearts by including Terry Leahy as an adviser.
The Times reported in August that Leahy, a former Tesco chief executive, said during a video message that he "knew Sir Ken Morrison well" and understood the "values and vision" of the late former Morrisons chair.
On Wednesday, the company noted that: "In addition to the financial terms of any offer, the Morrisons board continues to place very significant emphasis on the wider responsibilities of ownership of Morrisons. These responsibilities include a recognition of the importance to the Morrisons business of all stakeholders, including colleagues, customers, pension trustees and suppliers as well as the distinct heritage and history of Morrisons and the legacy of Sir Ken Morrison."
Morrisons said it now expects to receive a scheme document detailing the CD&R offer and conditions by around September 25, having already received Fortress' scheme document on July 22.
The supermarket chain said it plans meet with CD&R around October 18. Meetings to approve the competing Fortress offer will now be adjourned until that date.
Fortress, also on Wednesday, continued to urge Morrisons' shareholders to take no action in respect to the CD&R bid.
Morrisons - which has seen its share price surge in recent weeks due to the M&A prospects - will later this month re-enter the FTSE 100 just six months after a demotion in March.
Shares in Wm Morrison were trading up 0.5% at 292.60 pence each in London on Wednesday morning, valuing the company at GBP7.06 billion.
By Scarlett Butler; scarlettbutler@alliancenews.com
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