Booker has agreed to buy Londis and Budgens owner Musgrave GB for £40m in a move set to strengthen its position as the UK’s largest symbol operator.
The deal, which is still subject to approval by the Competition and Markets Authority, will see Booker acquire 1,630 Londis stores and 167 Budgens stores. These will be added to its existing retail estate of more than 3,000 Premier, Premier Express and Family Shopper stores.
Booker stated that Londis and Budgens retailers will retain their brands and will benefit from an “improved local and national supply chain”. It added that Booker retailers will take advantage of Musgrave’s supply chain, and claimed “increased scale and operational efficiency” would also lower prices for store owners.
In addition, Booker and Musgrave are also developing a strategic partnership “to facilitate opportunities and the sharing of competencies between the two groups”.
Dan Cock, owner of Premier Whitstone Stores, said the deal was a “win-win” for Booker retailers: “It’s no secret that Booker’s strong point has never been fresh and chilled, so having access to Musgrave’s range is very exciting news.”
Raaj Chandarana, owner of Premier Tara’s News in High Wycombe, added: “With the fresh and chilled offer, the access to different manufacturers and the shared synergy with distribution, I think this is going to be a game-changer.”
However, Londis retailer Ramesh Shingadia said: “It has come as a bit of a shock for us. It is still early days so we will have to wait and see what happens.”
Booker chief executive Charles Wilson said: “Competition in convenience is increasing, and the multiples have increased their footage by 37% since 2007. With Booker, Londis and Budgens coming together, we’ll really help independent retailers prosper and compete against the multiples.
“Musgrave has been struggling in Great Britain for some time now and has been making operating losses for a few years. But Budgens and Londis have some excellent people and a first class supply chain, and we have a track record of turning businesses around.”
Musgrave chief executive Chris Martin said: “Musgrave GB has been a loss-making business and while the decision to sell Budgens and Londis is difficult, it will allow the Group to drive forward with its growth strategy which is about developing our market-leading retail, convenience and cash and carry brands in the Republic of Ireland, Northern Ireland and Spain.”