Boots: Bid details

I’ve had it confirmed that the institution mulling a Boots bid is KKR, which is the world’s biggest private equity firm and the de facto founder of the private equity industry. It has also been in the private equity consortium mulling a bid for Sainsbury. It’s not yet clear whether its interest in Boots will have implications for the Sainsbury deal.

One thing’s clear: the Treasury’s review of “shareholder debt” hasn’t put off the private equity boys.

Update 18:45 GMT: The disclosure that Stefano Pessina is collaborating with KKR on the bid massively increases the likelihood that this deal will go through. He is the creator of Alliance UniChem, which merged last year with Boots. But the crucial point is that the Monaco-based Italian billionaire controls at least 15 per cent of Boots’s shares.

What’s more, more than half of all Boots’s shares are in the hands of relatively few investment institutions. So KKR/Pessina won’t have to persuade too many holders to nab their prize.

One bunch of brainy people who presumably are feeling a little silly tonight are investment banks’ sell-side analysts, since almost all of them rated Boots’s shares as a “sell”. Their bearishness seems to have given Pessina his opportunity to offer just under £10bn for a business with formidable cash-generating capacity and a great opportunity to expand around the world.

Looks as though another great British business will soon be in overseas hands.