US retailer Wal-Mart has launched a shock £6.72bn bid to take over supermarket giant Asda.
The bid – which offers 220p cash for each Asda share – ends speculation about the way the US supergroup wants to enter the UK market and puts Asda’s proposed merger with Kingfisher in doubt. However, previously both Asda and Wal-Mart had denied rumours of a link-up.
Wal-Mart – the world’s biggest retailer – has made an offer which would give a 24.6% premium on Asda’s share price on the day before it announced plans to merge with Kingfisher – and a 19.2% premium on the closing price of Asda shares on Friday.
Asda’s board has already said the Wal-Mart offer was “fair and reasonable”.
Wal-Mart currently operates 3,601 stores, employs more than 910,000 people worldwide, and sales amounted last year to $137.6bn (£85.7bn).
Asda – which would become its first acquisition in the UK – is the third-largest supermarket chain with annual sales of more than £8bn from 229 stores
EGi News 14/06/99
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