Fortress lifts bid for Morrisons to £6.7bn

Supermarket chain Morrisons has agreed to an increased £6.7bn takeover offer from a consortium led by SoftBank-backed Fortress Group.

Fortress has lifted its offer to 272p a share form 254p a share. Under the terms of the deal, Morrisons shareholders will receive 270p a share in cash plus a special dividend of 2p.

The consortium also includes the Canada Pension Plan Investment Board and an investment company controlled by Koch Industries.

News of the increased offer comes just days before the deadline for rival buyout firm Clayton, Dubilier & Rice to put forward an offer.

"The original Fortress offer was announced after extensive negotiations between the Morrisons board and Fortress," the investment group said. "However, Bidco notes the speculation regarding a possible counter-offer by CD&R. Bidco remains committed to becoming the new owner of Morrisons and to being a responsible long-term steward of this great British company through the next stage of its evolution.

"Accordingly, Bidco has engaged with the Morrisons board and its advisers in relation to the value of the original Fortress offer."

CD&R has until Monday to put forward an offer.

At 1250 BST, Morrisons shares were up 2.2% at 278p.

Laura Hoy, equity analyst at Hargreaves Lansdown, said: "The renewed offer came off the back of speculation that a better offer from CD&R could be on the horizon as well as vocal hostility form some large shareholders. The board at Morrisons has agreed to the offer, which promises to keep Morrisons’ existing strategy in place and refrain from closing stores - a rarity in the world of private equity takeovers, and may assuage concerns among staff and the wider communities where the company operates.

"The deal is signed, sealed, but not yet delivered. CD&R can still come back with a better offer - the group’s deadline is August 9. It will also have to be passed by shareholders, who are due to vote on the proposed takeover on 16 August."