Booker Group plc, the UK’s biggest food wholesaler and Musgrave Group plc, announced this morning that they had signed a sale and purchase agreement for Booker to acquire the entire issued share capital of Musgrave Retail Partners GB Limited, which comprises the Londis and Budgens businesses in Great Britain, for £40m (net of cash balances being acquired).
The deal, which is subject to regulatory approval (but does not require shareholder approval), means that Musgrave has effectively withdrawn from the British mainland, althiough it will continue to operate in Ireland, Spain and Northern Ireland.
Londis has 1,630 symbol and convenience stores, and sales in the year to December 2014 were £504m, while Budgens, which operates on a franchise model and comprises 167 larger stores, had sales of £329m in 2014. In the year to December 2014, Musgrave Retail Partners GB Limited had sales of £833m and made an operating loss before exceptional items of £7.4m.
It is thought that the Budgens and Londis fascias and own-brands will be retained. A Booker spokesperson said: “Through Booker, Londis and Budgens joining forces, we will help independent retailers and consumers throughout Great Britain. Following completion, Booker’s aim is to further develop the Budgens and Londis brands alongside Premier and Family Shopper, Booker’s retail brands. GB Limited’s supply chain will be used for delivery to Booker retail customers. Budgens and Londis customers will retain their brands, but will benefit from a better local and national supply chain. This will help improve the choice offered by the retailers to the consumer. The increased scale and operational efficiency should help lower prices, and retailers will benefit from a better delivery and cash and carry service. This will help independents prosper amid the changes that are occurring in the grocery market.”
More on this story in the next issue of Wholesale News.