Boots targeted by private firms
BOOTS shares surged today as speculation over takeover interest from private equity firms caused investors to look beyond the retailer's trading woes.
The stock put on 2% amid strong dealing volumes after the Wall Street Journal said US-based Blackstone and Texas Pacific and CVC Capital Partners and Cinven of the UK were looking at their options over the £4.6bn-rated group.
Boots would become the latest major UK retailer to attract the interest of private equity firms, following an approach from Apax Partners for Woolworths and a successful bid by a consortium for Debenhams.
The interest emerged a day after the Nottingham-based retailer announced its second profits warning in as many months and said it planned to sell off its Strepsils-to-Nurofen division Healthcare International.
Analysts said the disposal of the business, which could be worth as much as £1.25bn, made an approach for the whole group more attractive.
According to the Times, GlaxoSmithKline is a lead contender to land the business, although German healthcare group Bayer and air freshener-to-Lemsip group Reckitt Benckiser are also seen as contenders.
Boots has promised to return much of the proceeds from the deal to investors, another factor for keeping shares in positive territory. They were 14p at 629½p in mid-morning trading.
