Shoppers Could Pay The Price

Critics fear that Morrisons customers, workers and suppliers could miss out after the supermarket’s board supported a new takeover proposal from a group of questionable investors.

The chain announced at the weekend that it had received a second take over bid, worth £6.3 billion, from a consortium led by US private equity firm Fortress, and would recommend the proposal to its shareholders.

The bidders have agreed to be good stewards of the popular British grocery store, promising to keep the headquarters in Bradford and not to make any material sales of its property, but critics have questioned their intentions.

Lord Sikka, a Labour rival and professor at Essex Business School, said that he was concerned whether this was a good deal for customers, workers and businesses in the supply chain, and he said that private equity had a way of only paying minimum wage and not offering any security to the supply chain.

He said that many firms had made promises in the past to protect British jobs, but that they need practical measures, and for that, they need to involve employees in the sale process.

Morrisons bosses are set for bumper payouts under the Fortress proposal, and that Chief executive David Potts would receive £19 million for the 3 million shares he owns outright and 4.6 million that he could receive under various company reward schemes.

Operating chief Trevor Strain could make £11 million and finance boss Michael Gleeson more than £3 million.

The new Fortress led offer will also include Canadian pensions titans CPPIB and KREI, a division of Koch Industries, owned by billionaire Donald Trump ally Charles Koch. Fortress was established in 1998 by partners including Wesley Edens, a majority shareholder in Aston Villa football club.

Morrisons shareholders will now vote on the deal, and it must be passed by more than 50 per cent of those who vote and together they must hold 75 per cent of the company, but top ten shareholders, fund manager J O Hambro, said that bidders should be offering 270p per share for Morrisons, well above Fortresse’s bid of 254p.

Private equity firms acquire companies and look to sell them about five years later for a profit, but they’re usually criticised for their unmerciful tactics and short term outlook.

Critics drew attention to the track record of Morrison’s new bidders. Charles Koch and his late brother David sparked outrage in 2010 after pumping more than £700,000 into a campaign to repeal California’s climate change laws.

The family’s foundation, which invests in property, has also funded to evict tenants from their homes during the pandemic.

In the meantime, CPPIB declined to back an agreement between shopping centre business Intu and its lenders to give it breathing room on its debt last year.

The fears for Morrisons came amid a tide of takeover attempts for British businesses by private equity firms.

The bidders have agreed to be good stewards of the popular British grocery business, promising to keep the headquarters in Bradford and not to make any material sales of its property, but, if the bidder is successful, they will leave no stone unturned in its attempts to wring every last skerrick of juice out of its investment.

They will invest nothing, they will borrow the money and dump enormous debts on Morrison’s, and the property owned by Morrison’s will be asset-stripped to their own property company and leased back at huge rental costs, and each store will start losing thousands by the day.

However, the equity company will rake in a fortune with management fees, and suppliers will be savagely bullied to cut costs and employees will be reduced, and within five years Morrison’s will be gone like BHS, Debenhams et cetera, and all assets stripped, and it’s time our government stepped in to protect British companies.

Remember Cadbury, it was taken over by American food giant Kraft, which promised to keep the Keynsham site open, but days after the takeover was completed the firm controversially announced that it would shut the factory and shift production to Poland.

Published by Angela Lloyd

My vision on life is pretty broad, therefore I like to address specific subjects that intrigue me. Therefore I really appreciate the world of politics, though I have no actual views on who I will vote for, that I will not tell you, so please do not ask! I am like an observation station when it comes to writing, and I simply take the news and make it my own. I have no expectations, I simply love to write, and I know this seems really odd, but I don't get paid for it, I really like what I do and since I am never under any pressure, I constantly find that I write much better, rather than being blanketed under masses of paperwork and articles that I am on a deadline to complete. The chances are, that whilst all other journalists are out there, ripping their hair out, attempting to get their articles completed, I'm simply rambling along at my convenience creating my perfect piece. I guess it must look pretty unpleasant to some of you that I work for nothing, perhaps even brutal. Perhaps I have an obvious disregard for authority, I have no idea, but I would sooner be working for myself, than under somebody else, excuse the pun! Small I maybe, but substantial I will become, eventually. My desk is the most chaotic mess, though surprisingly I know where everything is, and I think that I would be quite unsuited for a desk job. My views on matters vary and I am extremely open-minded to the stuff that I write about, but what I write about is the truth and getting it out there, because the people must be acquainted. Though I am quite entertained by what goes on in the world. My spotlight is mostly to do with politics, though I do write other material as well, but it's essentially politics that I am involved in, and I tend to concentrate my attention on that, however, information is essential. If you have information the possibilities are endless because you are only limited by your own imagination...

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: