Morrisons boss under pressure as buyout rumours swirl
Morrisons shares rallied in early London on speculation to take the business private
Wednesday 12 February 2014
Pressure was mounting on Morrisons’ chief executive Dalton Philips today after revelations that the supermarket’s founding family has approached some of the biggest private equity groups to discuss turning the business private again.
However, Sir Ken Morrison, said he had no knowledge of the negotiations, likely to be conducted by younger generations of the trust which controls the family’s 9 per cent stake.
“I was quite surprised to see it,” he said of a Bloomberg report that Morrison family members had been in touch with buyout groups including CVC, Apax Partners and Carlyle. “They [the family] will all have considered views on the performance of the business. I am honorary president, which means I don’t have a vote, I am not consulted and I don’t have views. It’s not a job that I relish, you know.”
The UK’s fourth-biggest supermarket chain had a dreadful Christmas and had to issue a shock profit warning, while the chain continues to lose thousands of customers as it plays catch up with an online offering and convenience stores. Sir Ken said trading had been “very unsatisfactory”.
The private equity groups have all been approached by the family to raise enough cash for a £7 billion buyout. But any deal may need the involvement of more than one private equity group. Carlyle and CVC are in talks about working together, reports suggest, while Apax is thought to have walked away.
Morrisons has already been under pressure from hedge fund Elliott Management, an activist shareholder, which called on the company to start selling some of its 453 freehold stores and return the cash to investors.
A similar approach in-volving a sale-and-leaseback plan is likely to be put forward by any family and private equity deal — which would go against the founding principles of Sir Ken, the 82-year-old son of the founder, who also ran the company for 40 years.
Sir Ken has always said Morrisons should not sell its freeholds, as this gives the company more control over the running of the business, and it should remain debt-free.
Morrisons’ problems were laid bare when latest data showed sales had fallen 2.5 per cent, with market share also down, in the 12 weeks to February 2. It is understood Morrisons itself has not yet been approached over a deal.
- 1 Double chins could be 'cured' without surgery or dieting using new injection
- 2 The BBC has just done more to eradicate ‘terrorism’ than all our wars since 9/11
- 3 Dog thinks owner is drowning in lake, dives in and tries to pull him out
- 5 Thank heavens for Louise Mensch and her foul-mouthed tweets to world leaders
Scientists discover way to unboil an egg – and the results are not as pointless as that sounds
Saudi preacher who 'raped and tortured' his five -year-old daughter to death is released after paying 'blood money'
Greece elections: Greek PM Alexis Tsipras takes aim at 'neo-liberal' Europe as country gears up for prolonged austerity battle
Auschwitz liberation 70th anniversary: Woman sent to three Nazi death camps describes surviving gas chamber
Chilling drone footage captures Auschwitz ahead of 70th anniversary of liberation
'We would evict Queen from Buckingham Palace and allocate her council house,' say Greens
French court convicts three over homophobic tweets, in case hailed as a 'significant victory' by LGBT rights campaigners
Greece elections: Syriza and EU on collision course after election win for left-wing party
British Muslim school children suffering a backlash of abuse following Paris attacks
Islamic history is full of free thinkers - but recent attempts to suppress critical thought are verging on the absurd
British grandmother Lindsay Sandiford faces execution by firing squad in Indonesia
iJobs Money & Business
£16500 - £16640 per annum: Recruitment Genius: This fast growing Finance compa...
£30000 - £32000 per annum + benefits : Ashdown Group: A highly successful, int...
£18000 - £20000 per annum: Recruitment Genius: This rapidly expanding business...
£25 - 28k + Bonus: Guru Careers: An In-house / Internal Recruiter is needed to...