Morrisons left the stock market today after 54 years following the completion of the £7.1bn takeover by US private equity firm Clayton, Dubilier & Rice (CD&R).
The UK’s fourth-largest supermarket, which was set up in 1899 and listed in 1967, subsequently announced that Chairman Andrew Higginson, alongside non-execs Rooney Anand, Susanne Given, Kevin Havelock, Lyssa McGowan and Jeremy Townsend, had tendered their resignations and were stepping down from the Morrisons board.
Sir Terry Leahy, the former CEO of Tesco who was a senior adviser to CD&R during the bidding process, is expected to take over the Chairman role at the newly privatised company. This will reunite him with his former Tesco employee David Potts, who has been Chief Executive of Morrisons for more than six years and is staying on under the new ownership.
Chief Operating Officer Trevor Strain and Chief Financial Officer Michael Gleeson will also remain on the Morrisons board. CD&R has yet to announce its own appointments.
CD&R’s takeover was given the green light by 99.2% of shareholders at a meeting last week. On Monday, Morrisons and CD&R announced that the court had sanctioned the scheme of arrangement for the purchase of the business, which today became active.
Unions and politicians have been anxious about what a private equity takeover will mean for Morrisons, with concerns raised that the business could be stripped of its valuable property holdings and loaded up with debt. CD&R’s pre-auction offer had promised that the retailer’s head office would remain in Bradford, staff pay rates would be protected, and there were no plans to sell off its store estate to raise cash. However, these commitments are not legally binding.
After the investor backing last week, Sir Terry said: “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.”
NAM Implications:
- All going according to plan, so far…
- Fingers crossed…
