Morrisons prepares £1.5bn Iceland takeover

Morrisons is the frontrunner in the race to buy Iceland, currently valued at £1.5bn, according to reports.

Iceland ad featuring Stacey Solomon
Iceland ad featuring Stacey Solomon

Richard Pennycook, Morrisons’ group finance director has held meetings with investment banks to advise on the bid for Iceland ahead of an auction for the 750-strong chain, say national newspapers.

Iceland’s biggest shareholder, the failed Icelandic bank Landsbanki, hired UBS and Bank of America Merrill Lynch to find a buyer for its 67% stake in the supermarket earlier this month.

Rival supermarket chains Sainsbury and Asda are also reported to be interested in buying the majority stake in the frozen food retailer.

An Iceland takeover would boost Morrisons’ convenience store drive and would increase the company’s market share by about 2% to 14% – bringing it nearer to its closest rival, Sainsbury’s, which has a 16% share of the sector.

A Morrisons takeover is likely to face opposition from Iceland chief executive Malcolm Walker who owns 26% of the company and made a £1bn bid for the remainder he does not already own last year.

Morrisons has pledged to invest £3bn in its stores, own label ranges and the development of online platforms over the next three years.

X Factor finalist Stacey Solomon was recently appointed as the new face of Iceland, following previous brand ambassadors Jason Donovan and Kerry Katona, who was dropped in 2009 after she was caught using drugs.

Latest from Marketing Week

NOT REGISTERED? IT'S FREE, QUICK AND EASY!

Access Marketing Week’s wealth of insight, analysis and opinion that will help you do your job better.

Register and receive the best content from the only UK title 100% dedicated to serving marketers' needs.

We’ll ask you just a few questions about what you do and where you work. The more we know about our visitors, the better and more relevant content we can provide for them. And, yes, knowing our audience better helps us find commercial partners too. Don't worry, we won't share your information with other parties, unless you give us permission to do so.

Register now

THE BEST CONTENT

Our award winning editorial team (PPA Digital Brand of the Year) ask the big questions about the biggest issues on everything from strategy through to execution to help you navigate the fast moving modern marketing landscape.

THE BIGGEST ISSUES

From the opportunities and challenges of emerging technology to the need for greater effectiveness, from the challenge of measurement to building a marketing team fit for the future, we are your guide.

PERSONAL AND PROFESSIONAL DEVELOPMENT

Information, inspiration and advice from the marketing world and beyond that will help you develop as a marketer and as a leader.

Having problems?

Contact us on +44 (0)20 7292 3711 or email subscriptions@marketingweek.com

If you are looking for our Jobs site, please click here