Private equity firms vie for Iceland after Morrisons pulls out

The grocer Morrisons did not lodge a final-round bid to acquire Iceland Foods, the frozen food chain up for sale for up to £1.5bn.

The private equity firms Bain Capital and BC Partners are thought to be the only two parties that submitted second-round bids by the deadline of Tuesday. Another buy-out firm, Blackstone, is understood to be out of the race.

Iceland's chief executive, Malcolm Walker (pictured), who along with its management team owns 23 per cent of the retail group, has pre-emption rights. This gives Mr Walker 42 days from when the final offer of another party becomes unconditional to present a fully financed firm bid matching the price.

Morrisons remains interested in picking up any stores, if they become available after the sale of Iceland. The failed bank Landsbanki is selling its 67 per cent stake in Iceland. All parties declined to comment.