// Morrisons frontrunner Fortress indicates business review plan if takeover succeeds
// Morrisons investors are preparing for a crunch vote on Fortress’ offer on August 16
// Fortress said that it does not plan to sell a “material” number of stores
Private equity firm Fortress, which had a £6.3 billion offer accepted and recommended to Morrisons’ board, is expected to conduct a wide-ranging review of the grocer, should the takeover succeed.
The US firm said it would conduct “a fuller evaluation of Morrisons and its operations and organisational structure” within the first six months of ownership.
The review would include Morrisons’ property portfolio.
Morrisons investors are preparing for a crunch vote on Fortress’ offer on August 16.
Fortress said that it does not plan to sell a “material” number of stores.
However, the plans for a “fuller evaluation” are likely to raise concerns among some investors who warn that any buyer will seek to extract value from the property portfolio through sale and leaseback agreements.
Business secretary Kwasi Kwarteng has publicly supported the takeover following talks with the Morrisons leadership team including chief executive David Potts and chair Andy Higginson.
He said this is a “vote of confidence to the UK”.
“It is not a bad thing if foreigners want to come and buy really good assets in your country. It means you are attracting capital, you are attracting investments, and that creates jobs,” he said.
The circular sent to shareholders also included details of more than £300 million in fees that would be raked in by advisers and bankers should the acquisition go ahead.
Bankers, lawyers, PR advisers and accountants acting for Fortress will be paid up to £263 million collectively, while Morrisons will spend up to £49 million to the likes of Rothschild, Jefferies and Shore Capital.