Jan 27, 2017
Tesco: Booker value
Tesco on Friday said it would pay £3.7bn in cash and shares to acquire Booker, a cash-and-carry business serving independent retailers and caterers. In 2000, frozen foods group Iceland bought Booker, for a tenth of the price Tesco is paying. Booker is a much better business today; indeed, on many metrics it is superior to Tesco. For Booker investors, the initial 9 per cent rise in Tesco's shares turns a measly 12 per cent premium over the undisturbed price into a respectable 20 per cent. The deal brings Booker chief executive Charles Wilson into the Tesco fold.
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