Government must 'closely scrutinise' agreed £6.3bn takeover bid for Morrisons, says Labour
THE Labour Party is calling on the Government to “closely scrutinise” an agreed £6.3 billion takeover bid for the Bradford-based supermarket chain Morrisons from a consortium of investment groups.
Seema Malhotra, Labour’s shadow minister for business and consumers, said Ministers must ensure legal promises are made about the integrity and future of the business, including any impact on the supply chain and distribution centres.
The offer for Morrisons led by Softbank-owned Fortress which has partnered with Canada Pension Plan Investment Board and Koch Real Estate Investments, will see shareholders receive 252p per share plus a 2p special dividend. The all cash offer is subject to shareholder approval.
Ms Malhotra said: “Britain’s supermarkets provide an essential national service and the Covid crisis has highlighted their importance to customers, communities and our retail and farming industries.
“Any takeover bid must therefore be closely scrutinised by the Government.
“Ministers must urgently work with Morrisons and the consortium to ensure that crucial commitments to protect the workforce and the pension scheme are legally binding, and met.
“Ministers must also ensure legal promises are made about the integrity and future of the business, including any impact on the supply chain and distribution centres.”
Bosses at Morrisons said Fortress has a “full understanding and appreciation” of the fundamental character of Morrisons. A spokesman said Morrisons won’t be commenting beyond a statement published on Saturday.
Fortress has invested in grocery retail in both North America and Europe, and has invested in Majestic Wine in the UK.
Andrew Higginson, chairman of Morrisons, said: “The Morrisons directors believe that the offer represents a fair and recommendable price for shareholders which recognises Morrisons’ future prospects.
“Morrisons is an outstanding business and our performance through the pandemic has further improved our standing and enabled us to enter the discussions with Fortress from a hard-won position of strength.
“We have looked very carefully at Fortress’ approach, their plans for the business and their overall suitability as an owner of a unique British food-maker and shopkeeper with over 110,000 colleagues and an important role in British food production and farming.
“It’s clear to us that Fortress has a full understanding and appreciation of the fundamental character of Morrisons.
Joshua A Pack, managing partner of Fortress, said: “We believe in making long-term investments focused on providing strong management teams with the necessary flexibility and support to execute their strategy in a sustainable and value-enhancing manner.
“We fully recognise Morrisons’ rich history and the very important role Morrisons plays for colleagues, customers, members of the Morrisons pension schemes, local communities, partner suppliers and farmers. We are committed to being good stewards of Morrisons to best serve its stakeholder groups, and the wider British public, for the long term.”