One of Britain's biggest tobacco and convenience goods wholesalers is at the centre of urgent talks over the impact of Tesco (Frankfurt: 852647 - news) 's £3.7bn swoop on Booker, the cash-and-carry group, on its finances.
Sky News has learnt that lenders to Palmer and Harvey, which employs about 4,000 people, have called in FTI Consulting (NYSE: FCN - news) , a professional services firm, to provide advice on a refinancing of the company.
Sources said the review had acquired a fresh momentum since Tesco announced that it had agreed to buy Booker for £3.7bn - a takeover that has sparked wider concerns about the combined group's dominance of Britain's grocery sector.
A change in GE Capital's UK presence is said to be one of the factors behind the imminent refinancing of P&H's balance sheet.
"There's no doubt that the lenders are concerned about what this deal does to Palmer and Harvey's prospects," said a source close to the work.
In a statement, a spokeswoman for the company, which is one of the biggest employee-owned businesses in the UK, said: "As part of a planned refinancing process, FTI were brought in to undertake due diligence on behalf of the Company and its lenders, as they were for last year's refinancing.
"They were appointed before the Booker-Tesco deal was announced.
"Clearly their due diligence will now include any aspects of this announcement which may impact on Palmer & Harvey.
"The company believes that it is well placed to take advantage of the many opportunities that the market currently presents."
Tesco stunned the City when it pounced on Booker in late January, with rivals warning that it would create an excessively concentrated player in food wholesaling, retailing and distribution.
P&H is majority-owned by current employees and management, with the remaining shares held by former staff.
The company was established in 1925 as a tobacco and sweets wholesaler, and is the biggest distributor to the UK's convenience sector.
It serves about 90,000 outlets across the country, using a fleet of 1,300 vehicles.
The company is run by Tony Reed, a former boss of Tesco's convenience retailing business.
One source close to P&H insisted that the takeover of Booker could open up new business opportunities for the independent wholesaler.
Booker owns the Budgens and London fascias, although Tesco has argued that they are operated using a franchise model, and should not be used to justify rivals' arguments that the deal is anti-competitive.
Tesco's bid for Booker triggered the resignation of Richard Cousins, its senior independent director, who believes that the UK's biggest retailer should focus on emerging from the ongoing industry price war in better shape after a torrid three years.