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Clayton, Dubilier & Rice make money at Morrisons

US Clayton-based independent firm Dubilier & Rice is set to acquire Wm Morrison retail company in a deal that could take Britain’s fourth-largest retailer in private, according to two people familiar with the matter.

One of the men said Morrison’s board, which has a £ 4.3bn and $ 3.2bn total debt, met on Saturday to discuss the option. The company declined to comment.

CD&R is working with Goldman Sachs on its marketing, someone added. A statement explaining his intentions could be released on Saturday.

The exact cost of the donations was not immediately known but Sky News also said CD & R is testing Morrisons’ requests which could cost the company approximately $ 5.5bn. CD&R and Morrisons declined to comment.

This approach demonstrates the interest of UK private equity businesses especially retail stores.

Buyout groups have announced requests for at least 12 companies listed in the UK since this year, as Brexit and the epidemic weigh on regional prices. It is the fastest speed on secret experiments for more than two decades, the figures for the Refinitiv show.

The CD&R approach comes as competition regulators this week scrapped a $ 6.8bn deal with oil company owners at EG Group, billionaire Mohsin and Zuber Issa and TDR Capital, to buy the third largest UK market, Asda.

CD&R lists Sir Terry Leahy, a former Tesco executive, among their mentors. Andrew Higginson, current chairman of the Morrisons, worked with Leahy at Tesco for many years. He is also a competitor to compete at EG Group’s gas station, Motor Fuel Group.

The Morrisons management team, led by Dave Potts chief executive, has been trying to turn the system around since 2015, including a partnership with Amazon and Deliveroo.

However, the market did not reward them. Shares are now lower than Potts’ take and fell 6.3 per cent last year, compared to 11.5% in the FTSE 100 index of top UK companies since the beginning of this year when it was deregistered.

Earlier this month, 70% of shareholders he refuses his salary.

In the last year of January, the company also reported an 8% rise in the equity market even though total revenues were up 0.4% to $ 17.5bn due to significant oil prices.

Covid-related costs affect profits, with total revenues rising 0.5% to $ 96m. It employs 118,000 employees, according to Capital IQ.

Researchers have speculated that the group could fall into the hands of a seller who is attracted to its value and, like the third-party Asda, has more to sell.

CD&R has been one of the UK’s leading corporate corporations this year, approving a $ 2.8bn deal to buy a UK UDG medical team and a $ 308m deal with Wolseley, a water-producing business.


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