CD&R Readies Latest Salvo in $9 Billion Morrison Battle

(Bloomberg) -- Buyout firm Clayton Dubilier & Rice is putting the finishing touches on a higher offer for British grocer Wm Morrison Supermarkets Plc as it ratchets up a bidding war with Fortress Investment Group, people with knowledge of the matter said. 

CD&R is aiming to submit a revised bid as soon as Thursday that will top its earlier proposal of 230 pence per share, according to the people, who asked not to be identified because the information is private. 

To stay competitive, CD&R will need to beat Fortress’s latest bid, which would hand Morrison investors 270 pence per share plus a 2 pence dividend. The Fortress offer valued Morrison at about 6.7 billion pounds ($9.2 billion). 

CD&R has been considering what pledges it can make to win over Morrison’s board, Bloomberg News has reported. The proposal from Fortress came with a series of commitments on maintaining salaries, honoring supplier relationships and holding onto Morrison’s extensive property portfolio. 

The private equity firm has also been courting potential equity partners to join its revised bid, people with knowledge of the matter said last month. CD&R has until 5 p.m. on Aug. 20 to announce a firm offer for Morrison. 

Deliberations are ongoing, and its plans could still change, according to the people. A representative for CD&R declined to comment, while a spokesperson for Morrison didn’t immediately respond to a request for comment. 

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