CD&R wins race for UK supermarket chain Morrisons

US private equity group Clayton, Dubilier & Rice (CD&R) has won an auction for the UK supermarket chains Morrisons with a £7bn bid.

The win was revealed by the Takeover Panel on Saturday. CD&R offered 287p a share, against a rival bid from Fortress, for 286p per share.

Morrisons chair Andrew Higginson said the final offer from CD&R “represents excellent value for shareholders while at the same time protecting the fundamental character of Morrisons for all stakeholders”.

“CD&R have good retail experience, a strong record of developing and growing the businesses in which they invest, and they share our vision and ambition for Morrisons. We remain confident that CD&R will be a responsible, thoughtful and careful owner of an important British grocery business.”

Shareholders will now vote on the new offer at a meeting scheduled for October 19.

Higginson, who will step down if shareholders approve the offer, said he trusted CD&R to stick to its pledge to not sell off Morrisons’ store estate in order to raise cash.

“They’ve given a list of undertakings which, I think, under current legislation, is as good as we can get. And they’re very strong undertakings: to keep the business as it is, to keep the head office in Bradford,” he told the BBC on Monday.

There have been concerns among lawmakers and trades unions that the current spate of private equity takeovers would see UK firms asset stripped and saddled with debt.

Shares in rival Sainsbury’s shares jumped on Monday morning, taking it to the top of the UK's FTSE 100 index, on speculation it could be a fresh target for private equity firms, including Fortress, which said on Saturday that the UK was still “an attractive investment environment”, and that the consortium would “continue to explore opportunities”.