Booker cleared to complete takeover of Londis and Budgens
- Credit: Archant
Cash and carry chain Booker has been given the green light by the competition watchdog for its £40million takeover of Londis and Budgens.
Booker said today that the Competition & Markets Authority (CMA) had cleared its deal to buy the supermarket brands in the UK from Irish food wholesaler Musgrave Group.
Booker, which is already the largest cash and carry chain with more than 172 wholesale outlets and supplying over 129,000 independent retailers, now expects the acquisition to be completed by September 14.
The group has said the deal will upgrade the efficiency of the two brands’ supply chains amid the supermarket price war, which has seen intense price cutting due to the growth of discounters Aldi and Lidl.
Booker chief executive Charles Wilson said: “We are pleased that the acquisition of Londis and Budgens has been cleared by the CMA.
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“This will help strengthen our support for independent retailers throughout Great Britain.”
In a trading update also released today, Booker said it lifted group like-for-like sales excluding tobacco by 0.5% in the 10 weeks to August 28, despite a tough food retailing environment.
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However, it added that like-for-like tobacco sales slumped 6.6% in the period, reflecting a ban on small stores displaying tobacco products.
Brokers at Peel Hunt said: “Booker continues to be in excellent shape, with strong long-term growth prospects, a healthy balance sheet and strong cash generation.”
Booker will keep the Londis and Budgens branding following the takeover, with the two sitting alongside its own retail brands, Premier and Family Shopper.
Londis operates 1,630 convenience stores and made sales in the year to December of £504m. Budgens is a franchised chain of grocery stores, with 167 outlets that racked up sales of £329m last year.
Musgrave Retail Partners, the unit that held the brands for parent firm Musgrave, posted sales of £833m in the year to December, and made an operating loss before exceptional items of £7.4m.