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| Version 2 | Version 3 |
|---|---|
| Boots gets improved bid approach | Boots gets improved bid approach |
| (about 2 hours later) | |
| US-based private equity group Kohlberg Kravis Roberts (KKR) has improved its bid approach for UK chemist and drugs wholesaler Alliance Boots to £10.2bn. | US-based private equity group Kohlberg Kravis Roberts (KKR) has improved its bid approach for UK chemist and drugs wholesaler Alliance Boots to £10.2bn. |
| The new £10.40 pence-a-share proposed offer is 40p more than an earlier approach, which Boots rejected. | The new £10.40 pence-a-share proposed offer is 40p more than an earlier approach, which Boots rejected. |
| The move has the backing of Italian billionaire Stephano Pessina - who controls a 15% stake in Boots. | The move has the backing of Italian billionaire Stephano Pessina - who controls a 15% stake in Boots. |
| Boots has agreed to open its books to KKR and news of the higher offer pushed the chemist chain's shares higher. | Boots has agreed to open its books to KKR and news of the higher offer pushed the chemist chain's shares higher. |
| Boots shares closed 0.5 pence lower on the London market, at 1026.5p after earlier climbing as high as £10.40. | |
| Another bidder? | Another bidder? |
| The only question now is whether Boots will end up being owned KKR/Pessina or whether another bidder or bidders....now emerges Robert PestonBBC Business editor Read Robert Peston's blog Check Boots' share price | The only question now is whether Boots will end up being owned KKR/Pessina or whether another bidder or bidders....now emerges Robert PestonBBC Business editor Read Robert Peston's blog Check Boots' share price |
| BBC business editor Robert Peston said that Boots was likely to recommend its shareholders accept a bid at that level and that the firm was "on its way into new ownership". | BBC business editor Robert Peston said that Boots was likely to recommend its shareholders accept a bid at that level and that the firm was "on its way into new ownership". |
| He said that it was "highly unlikely" that a formal bid from KKR would not now materialise. | He said that it was "highly unlikely" that a formal bid from KKR would not now materialise. |
| "The only question now is whether Boots will end up being owned by KKR/Pessina or whether another bidder or bidders (which would also be from private equity) now emerges," he said. | "The only question now is whether Boots will end up being owned by KKR/Pessina or whether another bidder or bidders (which would also be from private equity) now emerges," he said. |
| Last weekend, reports linked UK investment group Terra Firma with a move for Boots. | Last weekend, reports linked UK investment group Terra Firma with a move for Boots. |
| Retail analyst Richard Ratner of Seymour Pierce said that the Alliance Boots board had "saved face" by pushing the price higher. | Retail analyst Richard Ratner of Seymour Pierce said that the Alliance Boots board had "saved face" by pushing the price higher. |
| "Of course, somebody else might appear, but Mr Pessina is key to the wholesale business so the odds must be on his offer going through," Mr Ratner said. | "Of course, somebody else might appear, but Mr Pessina is key to the wholesale business so the odds must be on his offer going through," Mr Ratner said. |
| New direction? | New direction? |
| Alliance Boots is best known in the UK for its 2,600 Boots the Chemist shops on the High Street. | Alliance Boots is best known in the UK for its 2,600 Boots the Chemist shops on the High Street. |
| But since its £7bn tie-up with Alliance UniChem last year it is now also a major drugs wholesaler, with a 40% market share, supplying more than 125,000 pharmacies, health centres and hospitals. | But since its £7bn tie-up with Alliance UniChem last year it is now also a major drugs wholesaler, with a 40% market share, supplying more than 125,000 pharmacies, health centres and hospitals. |
| Mr Pessina is believed to want to take the company private and grow it away from the public spotlight. | Mr Pessina is believed to want to take the company private and grow it away from the public spotlight. |
| But trade unions have warned that selling the group to a private equity firm could lead to asset-stripping. | But trade unions have warned that selling the group to a private equity firm could lead to asset-stripping. |
| Earlier this week Boots unveiled plans to rebrand its UK pharmacies, and said it was is cutting 300 manufacturing jobs at its Nottingham factory after losing a contract with Reckitt Benckiser. | Earlier this week Boots unveiled plans to rebrand its UK pharmacies, and said it was is cutting 300 manufacturing jobs at its Nottingham factory after losing a contract with Reckitt Benckiser. |