Private equity and the raid on corporate Britain

Private equity and the raid on corporate Britain

When the top brass of supermarket chain Wm Morrison gathered for their away-day in November, the company's response to the pandemic was not the only topic on the agenda. Its share price remained stubbornly low, and board members and senior managers discussed the odds that a lowball takeover offer would prove triumphant.

"We could see we might be vulnerable," says one person who attended the meeting, held at the Bradford headquarters of a company that traces its roots to a 19th-century Yorkshire market stall. 

Seven months later, Morrisons disclosed two takeover bids in quick succession from rival US private equity firms: an £8.7bn bid from Clayton, Dubilier & Rice in June that it rejected, and a £9.5bn offer from SoftBank-owned Fortress Group that it backed last weekend. Shareholders now expect a bidding war for the retailer, and Apollo Global Management, the private equity behemoth, has indicated it may enter the fray. 

Morrisons is the latest example of a dramatic shift in corporate Britain "” one that has accelerated during the coronavirus pandemic. For much of the past century, the economy has been dominated by companies listed on public markets "” their shares available to investors to buy and their managers facing a certain