The battle by MFG’s owner Clayton, Dubilier & Rice (CD&R) to takeover Morrisons will be decided by an auction, the Takeover Panel announced today (Wednesday September 29).
The organisation, which governs takeover deals, said Morrisons, CDR and CD&R’s fellow US private equity group Fortress had all agreed to the procedure.
The attempt to take over the supermarket group started in June when CD&R made a £5.5bn offer for the business which was rejected.
This was followed by a bid led by Fortress, which was subsequently upped to £6.7bn and supported by Morrison’s board.
However, that offer was trumped on August 20 by a £7bn bid from CD&R. It won the support of the Morrisons board, but Fortress urged Morrisons shareholders to take no action, suggesting that it might comeback with an improved offer.
The Takeover Panel said that as neither side had declared that its offer was final, a competitive situation still existed, and it agreed to the parties’ request for an auction.
The auction will take place on Saturday October 2 and will consist of up to five rounds of bidding. Morrisons board will than have until October 5 to announce whether it wishes to accept the winning offer.
If it is accepted a shareholder meeting will then have a vote on whether to go ahead with the deal.