Tesco boss Dave Lewis: We're committed to £3.7bn Booker deal

(c) Sky News 2017: <a href="http://news.sky.com/story/tesco-boss-dave-lewis-were-committed-to-16337bn-booker-deal-10816650">Tesco boss Dave Lewis: We're committed to £3.7bn Booker deal</a>
 

Tesco (Frankfurt: 852647 - news) boss Dave Lewis says the supermarket remains "completely committed" to its £3.7bn takeover of wholesaler Booker, after two big shareholders opposed the deal.

Schroders (Frankfurt: 929969 - news) and Artisan Partners, who together hold 9% of the group, voiced concerns that Tesco was overpaying and that the deal could be a distraction from its turnaround plan.

But the supermarket said the rationale for the takeover was "compelling" and that it would enhance the recovery effort while delivering benefits for customers and shareholders.

The deal, announced in January, will see Britain's biggest supermarket take over the largest wholesaler, Booker - which also owns the Premier (BSE: 500540.BO - news) , Londis and Budgens franchises operated by thousands of convenience stores.

There have been concerns that the deal could become held up by a lengthy competition investigation.

Mr Lewis said: "We're absolutely, completely committed to the deal.

"Since we made the announcement I've met tens of shareholders, here and in North America, and I'm really pleased with the response that we've got."

He said support for the deal was borne out by investors buying Tesco stock over the last two months.

Mr Lewis said those investors recognised the growth opportunity of the deal and projected annual cost savings of £200m.

He also stressed the deal was in the early stages, having yet to be formally considered by competition authorities, after which it will need approval from at least 50% of Tesco shareholders.

"This has got a long way to run," Mr Lewis said.

Bruno Monteyne, a former Tesco executive who is now an analyst at Bernstein, did not think the concerns raised by investors were enough to derail the deal.

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