Morrisons shares surge following takeover agreement, Apollo interest

imageStock Markets11 hours ago (Jul 05, 2021 08:10)

© Reuters.

By Samuel Indyk – Shares in Morrisons (LON:MRW) surged on Monday after the company accepted a takeover offer from Fortress, in what could spark a bidding war for the UK supermarket chain.

A second private equity group, Apollo Global Management, confirmed to the London Stock Exchange that it is in the preliminary stages of evaluating a possible offer for Morrisons.

The news follows a rejected bid last month from a third private equity group, Clayton, Dubilier & Rice (CDR), whose £5.5 billion proposal was turned down immediately. Morrisons said it “significantly undervalued” the company and its future prospects.

Although the new Fortress bid trumps CDR’s initial proposal, reports suggested CDR has “plenty more petrol in the tank” to make a higher offer.

Amazon (NASDAQ:AMZN), who already has a partnership with Morrisons, was previously touted as a potential buyer although has been tight-lipped on any offer and there has been no suggestion a bid is forthcoming.

Nevertheless, Morrisons is in the eyes of private equity given it owns the freehold on a large number of properties and for its long-standing relationships with its suppliers. The company also owns some of its own food manufacturing sites.

Before the original CDR bid on 19th June, shares in Morrisons were trading at 178p before jumping over 30% to around 240p at Friday’s close.

The current accepted offer from Fortress is worth 252p per share, plus a 2p special dividend.

At 08:05BST, shares in Morrisons were trading higher by 11.5% at 267p per share.

Morrisons shares surge following takeover agreement, Apollo interest

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.


Please enter your comment!
Please enter your name here