Woolies rejects Apax price range as `unacceptable'

WOOLWORTHS REFUSED to grant Apax Partners access to its books yesterday after the private equity group pitched a lowball takeover proposal worth between 50 to 55p per share.

The retailer, which rushed out its post-Christmas trading statement after sales stalled, said the indicative proposal was laced with pre-conditions. It dismissed the offer just hours after receiving it on the grounds that the range indicated failed to provide "acceptable value or certainty" to warrant further talks. Apax's proposed range valued its target at between pounds 718m and pounds 790m.

Shares in Woolworths, which updated the City after the stock market closed yesterday, reached 48p - well below the 60p-a-share level many analysts thought a bidder would have to pay. Before Christmas, its shares traded at about 46p.

Analysts said Woolworths' rejection could flush out other bidders although few observers could see the rationale for a private equity bid for a company that lacks a freehold estate. Asda and Tesco are among the mooted trade buyers.

Nick Bubb, at Evolution Securities, said: "Woolworths' management was obviously of the view that the company is worth more. So either they have got to justify that with a punchy recovery plan or they must think there is another party waiting to come in. I still think it is in play."

Richard Ratner, at Seymour Pierce, said: "The company is now ... in play. However, the pressure is now on the management to perform."

It took Woolworths' board, headed by Gerald Corbett, just one meeting to reject Apax's proposal, which it received on Monday. The company said: "The board, with its advisers, has considered this indicative proposal carefully. It has concluded that the range indicated does not provide acceptable value or certainty to justify entering detailed discussions with Apax."

The private equity group demanded full access to Woolworths' financial and trading information as part of its pre-conditions. Apax declined to comment on its intentions, but it has ruled out making a hostile approach. It had lined up Robert Dyas' former executive team, led by Robert Pedder and Brent Wilkinson, to head its bid approach.

Woolworths is anxious to avoid repeating the upheaval that preceded its demerger in 2001, when Kingfisher attempted to find a buyer. Privately, it feels it has suffered unduly from being the first retailer to heed the City regulator's edict that companies had to confess promptly to poor sales over Christmas. Its shares lost about one-fifth of their value after it brought forward its trading statement.

Although Trevor Bish-Jones, the chief executive, has improved operating margins, he has failed to grow the top line. Underlying sales over Christmas were flat.

Start your day with The Independent, sign up for daily news emails
Sport
sportWWE latest including Sting vs Triple H, Brock Lesnar vs Roman Reigns and The Undertaker vs Bray Wyatt
Arts and Entertainment
Louis Theroux: By Reason of Insanity takes him behind the bars again
tvBy Reason of Insanity, TV review
Arts and Entertainment
Cassetteboy's latest video is called Emperor's New Clothes rap
videoThe political parody genius duo strike again with new video
Arts and Entertainment
tvPoldark, TV review
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Retirement Coordinator - Financial Services

Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...

Recruitment Genius: Annuities / Pensions Administrator

Negotiable: Recruitment Genius: You will be the first point of contact for all...

Ashdown Group: HR, Payroll & Benefits Officer - Altrincham - up to £24,000.

£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...

Ashdown Group: Learning and Development Programme Manager

£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...

Day In a Page

Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat
Saudi Arabia's airstrikes in Yemen are fuelling the Gulf's fire

Saudi airstrikes are fuelling the Gulf's fire

Arab intervention in Yemen risks entrenching Sunni-Shia divide and handing a victory to Isis, says Patrick Cockburn
Zayn Malik's departure from One Direction shows the perils of fame in the age of social media

The only direction Zayn could go

We wince at the anguish of One Direction's fans, but Malik's departure shows the perils of fame in the age of social media
Young Magician of the Year 2015: Meet the schoolgirl from Newcastle who has her heart set on being the competition's first female winner

Spells like teen spirit

A 16-year-old from Newcastle has set her heart on being the first female to win Young Magician of the Year. Jonathan Owen meets her
Jonathan Anderson: If fashion is a cycle, this young man knows just how to ride it

If fashion is a cycle, this young man knows just how to ride it

British designer Jonathan Anderson is putting his stamp on venerable house Loewe
Number plates scheme could provide a licence to offend in the land of the free

Licence to offend in the land of the free

Cash-strapped states have hit on a way of making money out of drivers that may be in collision with the First Amendment, says Rupert Cornwell
From farm to fork: Meet the Cornish fishermen, vegetable-growers and butchers causing a stir in London's top restaurants

From farm to fork in Cornwall

One man is bringing together Cornwall's most accomplished growers, fishermen and butchers with London's best chefs to put the finest, freshest produce on the plates of some of the country’s best restaurants
Robert Parker interview: The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes

Robert Parker interview

The world's top wine critic on tasting 10,000 bottles a year, absurd drinking notes and New World wannabes
Don't believe the stereotype - or should you?

Don't believe the stereotype - or should you?

We exaggerate regional traits and turn them into jokes - and those on the receiving end are in on it too, says DJ Taylor
How to make your own Easter egg: Willie Harcourt-Cooze shares his chocolate recipes

How to make your own Easter egg

Willie Harcourt-Cooze talks about his love affair with 'cacao' - and creates an Easter egg especially for The Independent on Sunday
Bill Granger recipes: Our chef declares barbecue season open with his twist on a tradtional Easter Sunday lamb lunch

Bill Granger's twist on Easter Sunday lunch

Next weekend, our chef plans to return to his Aussie roots by firing up the barbecue
Joe Marler: 'It's the way I think the game should be played'

Joe Marler: 'It's the way I think the game should be played'

The England prop relives the highs and lows of last Saturday's remarkable afternoon of Six Nations rugby
Cricket World Cup 2015: Has the success of the tournament spelt the end for Test matches?

Cricket World Cup 2015

Has the success of the tournament spelt the end for Test matches?
The Last Word: Justin Gatlin knows the price of everything, the value of nothing

Michael Calvin's Last Word

Justin Gatlin knows the price of everything, the value of nothing