By Sabela Ojea and Ian Walker
Wm. Morrison Supermarkets PLC announced on Friday that it had accepted an increased offer from Fortress Investment Group Ltd. from SoftBank Group Corp., which values the UK’s fourth-largest grocer at 6.7 billion pounds ($ 9.33 billion).
As part of the offer, Morrison shareholders will receive 270 pence per share, plus a special dividend of 2 pence. The new price per share is a 7% premium over Fortress’s original offering of 254 pence per share.
Fortress, who is leading a team of investors to buy Morrison, said the new deal followed extensive discussions between the two parties and that he “remains committed to becoming the new owner of Morrison.” Fortress also said it is taking note of recent speculation about a possible counter-offer from Clayton Dubilier & Rice LLC.
Clayton Dubilier, a US private equity firm, made a possible £ 5.54 billion cash offer for Morrison in mid-June, which was rejected by the board saying it “under -highly evaluated “the company and its future prospects.
Since then, there has been speculation in the markets and the press that Clayton Dubilier will return with a higher bid, but the US company has not commented further on the matter. He has a deadline of Monday to bid higher or walk away under UK Takeover Panel rules.
Fortress’s previous offer of 252 pence per share plus a special conditional 2 pence dividend failed to gain support from Morrison’s largest shareholder, Silchester International Investors LLP, who said the plans of arrangement, with a 75% barrier for shareholder acceptance and squeeze-out, being at a disadvantage for shareholders in general. Silchester owns 366.1 million Morrison shares, or a 15.1% stake.
Fortress investors include Cambourne Life Investment Pte. Ltd., an investment vehicle of GIC Special Investments Pte. Ltd., a direct subsidiary of GIC Pte. Ltd. Other co-investors in the investment group include the Canada Pension Plan Investment Board and the real estate arm of Koch Industries, a private conglomerate led by billionaire Charles Koch.
Shares at 11:24 a.m. GMT were up 6.10 pence, or 2.2%, to 278.10 pence.