Morrisons shareholders wave through £7bn takeover

Morrisons shareholders waved through a £7bn private equity takeover on Tuesday but not without a last-ditch rebellion from small independent investors.

Just over a fifth of the supermarket’s shareholders, almost 22%, voted against the 287p a share offer from US private equity group Clayton Dubilier & Rice (CD&R) at a court meeting which required approval from 50% of investors.

However, these 1,733 shareholders hold less than 1% of Morrisons’ shares, so strong backing from institutional investors ensured the deal secured approval from 99.2% of shares voted, well over the 75% required level.

The deal will put Morrisons, which employs about 120,000 staff in the UK across its 497 supermarkets, as well as factories, farms and a company-owned fishing trawler, into private hands for the first time since the founding family listed it on the stock market in 1967.

Andrew Higginson, the chair of Morrisons, said: “We thank shareholders for the strong support received at today’s meetings. We remain confident that CD&R will be a responsible, thoughtful and careful owner of Morrisons and we will now move forward with the remaining steps in the acquisition process.”

Sir Terry Leahy, the former boss of Tesco who is a senior adviser to CD&R funds, said: “We are very pleased to have received the approval of shareholders and are excited at the opportunity that lies ahead.

“The particular heritage, culture and operating model of Morrisons are key features of the company and we will be very mindful of these during our tenure as owners. We very much look forward to working with the Morrisons team, not just to preserve the company’s many strengths – but to build on these, with innovation, capital and new technology – helping the business realise its full potential and delivering for all of its stakeholders.”

The deal unites Leahy with his former employees David Potts, who has been chief executive of Morrisons for more than six years, and Trevor Strain, the chief operating officer who joined Morrisons from Tesco in 2009.

CD&R’s bid now only requires rubber stamping by a court next week before the private equity group takes control on 27 October, the day after Morrisons exits the stock market. The group’s offer narrowly beat a 286p bid by a consortium led by Softbank-owned Fortress Investment Group in an auction showdown earlier this month.