UK convenience store supplier Londis said today it has agreed a £60m sterling takeover by Irish food group Musgrave, valuing each Londis share at £31,266 sterling.
Londis, a supplier owned by its 1,919 UK shopkeepers, said the offer was not the highest it had received, but it provided the best long term future for the group given increasing competition in the sector.
Musgrave had been forced to abandon an earlier £40m deal after it emerged that several directors were set to receive half the bid proceeds. In a statement, Londis said shareholders will receive all the £60m under the new proposal.
The offer will now be put to the Londis members. If it is accepted, then this would mean that Musgrave would become the biggest single supplier to independent retailers in the UK.
Cork-based Musgraves already owns the Bugdens chain in the UK, which has 232 outlets. It recently announced plans to transfer 172 Budgens stores to independent franchise retailers, which it says is a 'clear demonstration of our sustained commitment to the independent retail sector'.
'Our long heritage of working with independent retailers gives us a level of expertise and know-how, which is unique in British retailing,' commented Seamus Scally, Musgrave's Group Managing Director.
'Our aim always is to provide total support to progressive independent retailers giving them the opportunity to grow their stores and serve their communities,' he added.
* Big Food, which owns the Iceland chain, said it remained interested in Londis, but did not submit an offer.
It said it had refused to participate in an auction process run by KPMG, which was advising Londis. Big Food added that it would await publication of detailed financial information on Londis before evaluating the offer.
