Morrisons bidding war about to erupt?

A bidding war may be set to erupt over the buyout of UK supermarket chain Morrisons which may well be the largest private acquisition since the Boots pharmacy chain in 2007.

Morrisons, which as well as being a major grocery chain supplies Amazon with its UK Amazon Fresh groceries, was set to accept an offer of £9.5 billion from Fortress Investment Group.

This weekend the Times newspaper reported that US investment house Apollo Global Management is considering making a rival bid. As a result shares in the grocery chain soared by 11% on Monday. Apollo has already shown an interest in the UK grocery market – it was beaten in a bidding war for Asda earlier this year.

The Telegraph newspaper approached Clayton, Dubilier & Rice (CD&R) is also considering upping its own bid after that was rejected before Fortress moved in with theirs.

The Big 5 UK grocery chains are highly profitable and are seen as highly buyable businesses. It remains to be seen as to the outcome of what could be a three way bidding war. 


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