Londis UK starts talks with Musgrave on possible sale

The board of Londis UK yesterday instructed consultants KPMG to begin talks with Musgrave and a number of other bidders interested in buying the shopkeeper-owned co-operative.

A statement issued by Londis yesterday said KPMG Corporate Finance recommended that Londis "align the business to a third party" following a two-month review of the options facing the group.

"Accordingly, the board has instructed KPMG to commence negotiations with a number of parties who have made indicative proposals in the course of the evaluation process," the statement said.

Musgrave was one of the parties that made their pitch to KPMG during the review. Both Londis and the Irish group refused to comment yesterday, but it is understood that Musgrave is one of those that will enter talks with the consultants.

Londis would not say how many parties were interested. However, last January, Mr Stephen Barrett of KPMG told The Irish Times that the consultants had met 10 potential bidders, including Musgrave.

It is not known if the consultants will begin talks with all 10.

The Big Food Group (BFG), owner of the Iceland chain, tabled a rival offer to Musgrave's aborted bid last December.

The British media has also named Somerfield, Nisa and the Co-operative Group as potential suitors.

Musgrave's €57 million bid for the UK group was derailed when the Londis board withdrew its support.

A number of shopkeepers were protesting at the fact that the executive directors would have shared €28.5 million, while individual shareholders would have received just over €14,400 each.