UK frozen food retailer the Big Food Group (BFG) has written to shareholders in the Londis franchise grocery retailer to urge them to accept its proposed takeover bid.
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BFG called itself “the champion of the independent retailer” and described to Londis shareholders what it termed the “compelling business case for bringing together BFG and Londis”. The company has made an indicative offer of some £40m (US$72m) for Londis, and is attempting to woo shareholders away from a rival bid from Irish food distributor Musgrave by sweetening its offer to shareholders and cutting the amount that Londis directors would receive.
Londis shareholders withdrew their support for Musgrave’s bid after they learned that the four directors would receive a combined £21m if the company were taken over by the Irish group. They formed a shareholder action group to block Musgrave’s bid and are expected to renew their calls for the non-executive directors to resign. Formal bids from both BFG and Musgrave are likely to be submitted in February, while Somerfield and the Co-op are also believed to be mulling offers, reported the Daily Telegraph.
