Booker Agrees To Buy Londis And Budgens For £40m

The food wholesale‎r Booker has agreed to buy the Londis and Budgens chains in England, Scotland and Wales for £40m from privately owned Musgrave Group.

The deal, as reported by Sky News , will strengthen its status as an independent grocery retailer.

Booker, Britain's biggest cash-and-carry wholesaler, said on Thursday it expects its purchase of Musgrave, which comprises the two chains, to be neutral to earnings in the first year before adding to its earnings thereafter.

The company's shares rose more than 10%, making them the top gainer on London's FTSE-250 Midcap Index.

The takeover will add thousands more stores to Booker's network‎ across Great Britain and represents another bold move by its chief executive, Charles Wilson.

British consumers are shopping around for the best prices, buying little and often and increasingly opting for convenience stores or online shopping, rather than large out-of-town sites.

The acquisition will help Booker to compete with the country's four big supermarkets as they expand their own local convenience store networks amid an industry price war.

"Overall it will help independent retailers prosper," Mr Wilson said in a statement.

Booker, which also reported a 17% rise in full-year operating profit, said the increased scale and operational efficiency should help lower prices.

Londis operates 1,630 shops in the UK, and was originally set up in 1959 as an abbreviation of London District Stores, while Budgens has 167 stores.

The two additions to Booker's portfolio will complement its Premier symbol group, which has more than 2,800 stores nationally, all of which are independently owned.