Feb 28, 2018
Tesco wins shareholder backing for £4bn Booker’s takeover
Supermarket chain Tesco has finally sealed its £4bn takeover of wholesaler Booker after shareholders of both companies approved the long-running deal that had hit stumbling blocks with both regulators and investors. Schroders, a Tesco shareholder, last year questioned the logic of the grocer swallowing Booker just a few years after an accounting scandal and a record-breaking £6.4bn loss. Despite protests from some of their rivals, which claimed the tie-up would put them out of business, the Competition and Markets Authority found that Tesco and Booker were sufficiently different businesses and so their combination would not harm their competitors by eroding their buying power. Booker shareholders will receive a combination of 0.861 new Tesco shares plus 42.6p in cash. Based on the Tesco closing price on Wednesday of 210.8p, a rise of 1.8 per cent on the day, the deal values Booker at just over £4bn. Once the deal has closed, Charles Wilson, the chief executive of Booker, will take control of Tesco's enlarged UK business.
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