Tesco share price: Booker expects deal to close early next year

Provisional CMA findings expected this month

Tesco share price: Booker expects deal to close early next year

Tesco’s (LON:TSCO) takeover of Booker Group (LON:BOK) is expected to close early next year, the wholesaler has said. The comments came in the group’s results this morning and follow Tesco’s interims earlier this month when Britain’s biggest grocer restored its dividend.

Tesco’s share price has fallen deep into the red in today’s session, with the grocer’s shares trading without the attraction of their latest divided. As of 09:18 BST, the stock was 0.95 percent down at 186.25p, as compared with a 0.06-percent gain in the benchmark FTSE 100 index. Booker’s share price meanwhile is 0.34 percent up at 206.00p.

Booker deal update

Booker said in its results statement this morning that its proposed merger with Tesco was expected to complete early next year, subject to shareholder approvals among other things. The merger is currently undergoing an in-depth ‘Phase 2’ investigation by the Competition and Markets Authority, whose provisional findings on the deal are expected at the end of the month, ahead of a final report at the end of the year.

“The competition review of the planned merger with Tesco is progressing,” Booker’s chief executive Charles Wilson commented in the statement. The wholesaler meanwhile reported that its total sales had climbed 2.5 percent to £2.6 billion in the 24 weeks ended September 8, while operating profit came in nine percent higher at £89.1 million.

Analysts on Tesco

The 16 analysts offering 12-month price targets for Tesco for the Financial Times have a median target of 192.50p on the shares, with a high estimate of 270.00p and a low estimate of 140.00p. As of October 6, the consensus forecast amongst 23 polled investment analysts covering the blue-chip group advises investors to hold their position in the company.

As of 10:15 BST, Thursday, 12 October, Tesco PLC share price is 185.82p.

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