Morrisons takeover battle won by £7 billion bid from private equity giant

Mega acquisition now has to be approved by shareholders

Morrisons shareholders will vote on the final offer later this month (PA) (PA Wire)

The battle to buy supermarket giant Morrisons appears to have been won by a US private equity firm following a £7 billion bid.

Clayton, Dubilier & Rice will cough up 287 pence per share for the Bradford-based chain after winning an auction held by watchdog, the Takeover Panel.

It outbid a consortium led Fortress Investment Group, which had offered 286 pence a share for Morrisons.

The dramatic climax concludes perhaps the most high-profile in a string of takeovers of British companies by private equity companies this year.

But CD&R will still need to win the backing of shareholders - who will be asked to approve the purchase at a meeting on 19 October.

Assuming they do so, the US firm could complete its takeover by the end of October.

It follows a protracted acqusition process in which CD&R - hich has had its bid led by former Tesco chief executive Sir Terry Leahy – has been at pains to stress that it would uphold the 122-year-old supermarket's values.

Suggestions that the US firm could start selling off its new acquisition’s estate – unusually for a supermarket, Morrisons’ owns about 90 per cent of the land its stores sit on – were repeatedly denied; while commitments have been made to both employees and pension trustees.

But it may be that now the real hard work has to start: last month, Morrisons reported a 43 per cent slump in half-year profits after Covid-19 costs took their toll.

The supermarket has also warned price rises and product shortages are a possibility in the coming months due to current strains on supply chains.