London - Britain's biggest supermarket
Tesco has agreed to buy Booker, the country's
largest cash and carry wholesale supplier, for about 3.7 billion
pounds ($4.64 billion), cementing its dominant position in the
UK.
In a joint statement on Friday Tesco and Booker said the
combined group would bring benefits for consumers, independent
retailers, caterers, small businesses, suppliers, and staff as
well as value to shareholders.
"This merger with Booker will further enhance Tesco's growth
prospects by creating the UK's leading food business with
combined expertise in retail, wholesale, supply chain and
digital," said Tesco Chief Executive Dave Lewis.
The deal sees Lewis, who took the helm at Tesco in 2014 when
the firm was in crisis and losing market share rapidly, switch
to acquisition mode from his strategy of streamlining the
sprawling international business.
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His focus has been on reviving Tesco's main grocery business
in Britain and over the last two years he has sold Tesco's South
Korean arm for $6.1 billion, as well as its Turkish business and
the Giraffe restaurant chain.
Under the terms of the deal each Booker shareholder will
receive 0.861 new Tesco shares and 42.6 pence in cash.
Based on Tesco's closing share price on Thursday of 189
pence the deal represents a value of 205.3 pence per Booker
share - a premium of about 12 percent on its Thursday close.
The deal will result in Booker shareholders owning
approximately 16 percent of the combined group.