Booker chief executive Charles Wilson says that the proposed merger with Tesco will help independent retailers “go to the next level”.
Speaking on the day that that the £3.7bn merger was announced, Wilson said: “We serve 120,000 independent retailers including 3,300 Premier, 1,500 Londis and 140 Budgens stores - it is a privilege to serve these retailers, and this is an opportunity to continue to serve them better. Working with Tesco can let us go to the next level.
“Our retail customers are being hit with a number of issues such as business rates, National Living Wage, and auto-enrolment pensions and this is costing them at a time when business is difficult. With Tesco we can give them access to a range of everything they need, better quality, particularly in fruit & veg, and better service, because by combining the delivery fleets we can make sure that trucks spend less time driving around and more time delivering to stores.”
Wilson confirmed that under the merger proposal Booker would remain a distinct wholesale business within the larger group, and that existing Booker brands such as Farm Fresh would continue to be the labels used in independent stores, although utilising Tesco own-label contracts will result in a better quality and price.
Wilson maintained that retailer reaction had been “hugely positive” so far, adding: “We don’t hold retailers to contracts, we know we have to earn their business by showing them we can help them to prosper.”
The deal is subject to approval by both sets of shareholders and the UK competition authorities, a process which could take until the end of 2017 or even early 2018. In the meantime, it is “business as usual”, said Wilson, with synergies from the Musgrave acquisition in 2015 expected to be fully realised by the time the Tesco merger completes.