Tesco share price: WPP and General Atlantic in joint bid for Dunnhumby

on Jul 9, 2015
Updated: Oct 21, 2019

The world’s biggest advertising company WPP (LON:WPP) and private equity firm General Atlantic have reportedly teamed up to jointly bid for Tesco’s (LON:TSCO) Dunnhumby arm.

People familiar with the matter have revealed to Bloomberg that the two firms are among those who last week submitted offers for the customer data business behind Tesco Clubcard. Other bidders included Advent International, Warburg Pincus and Permira Advisers, which may team up with Google, the sources added.
Tesco — which seeks fresh capital after being hit by a £263 million overstatement of profits as well as a colossal record annual loss of £6.4 billion – acquired the services of Goldman Sachs in January to explore options for Dunnhumby. Interest has been strong, as a deal would give the buyer access to information on almost one billion consumers worldwide, and to analysis tools that help companies set prices, choose products and target promotions. However, the unit’s original £2 billion price tag has since been lowered to closer to £1 billion due to concerns that once the operation is no longer part of Tesco it will be less attractive to large clients. The business’s mooted valuation has also been slashed following the restructuring of an agreement with the division’s US retail partner, Kroger – a move, which is expected to see Dunnhumby’s profitability falling below projections.
After a brief dip in the morning, Tesco’s share price edged higher, standing 0.77 percent up at 203.35p as of 10:48 BST. Meanwhile, WPP’s stock was changing hand at 1,441.00p – 1.77 percent up intraday.
As of 11:06 BST, Thursday, 09 July, Tesco PLC share price is 203.32p.