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Thu 13 Feb 2014 04:19 PM

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Abu Dhabi-backed Carlyle asked to invest in UK's Morrisons

A deal would be the biggest purchase of a British retailer since the 2007 buyout of Alliance Boots

Abu Dhabi-backed Carlyle asked to invest in UK's Morrisons

The Carlyle Group, the US private equity firm in which Abu Dhabi’s Mubadala Development Company owns a 7.5 percent stake, is one of a number of firms which have been approached by the founding family of Britain's No. 4 grocer, Wm Morrison Supermarkets, to gauge their interest in taking the business private, it has been reported.

The Morrison family, which holds about 9.5 percent of the supermarket, had approached private equity firms CVC Capital Partners, Carlyle Group and Apax Partners, although the latter had decided not to pursue a deal, a Bloomberg report said, citing people with knowledge of the matter.

The report said the Morrison family has so far been unable to find a buyout partner due to the size of any potential deal and the grocer's poor performance after a sharp fall in like-for-like sales over Christmas.

Bloomberg said a buyout of Morrisons would exceed £7bn ($11.5bn) and require a group of funds to work together. At that price, a deal would be the biggest purchase of a British retailer since the 2007 buyout of Alliance Boots.

Morrisons, CVC, Carlyle and Apax declined to comment, while the Morrison family could not be immediately reached for comment.

Former chairman and chief executive Ken Morrison, whose father founded the company in 1899, holds the honorary post of life president of Morrisons but has not had any involvement in the running of the company since his retirement in 2008.

Morrisons' shareholders and retail analysts were doubtful that a deal would happen.

Last month the firm revealed it had endured a poor Christmas despite it having talked up its prospects in November. Its like-for-like sales fell 5.6 percent, excluding fuel, in the six weeks to Jan. 5 and it said year profit would be towards the bottom of the range of analysts' expectations.

Private equity firm The Carlyle Group was founded in 1987 and currently has assets totalling around $31.5bn. Abu Dhabi’s Mubadala Development Company bought a 7.5 percent stake in 2007.

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