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Metcash buys 50.1% of Mitre 10 for $55m

Metcash buys 50.1% of Mitre 10 for $55m

Retail company Metcash (ASX:MTS) has arranged to buy 50.1% of hardware retailer Mitre 10 in exchange for an estimated $55 million capital injection.

The scheme will also allow Metcash to acquire the remaining 49.9% of Mitre 10 at the end of the 2012 or 2013 financial year.

The amount Metcash will invest is dependent on Mitre 10’s financial position, including earnings and net debt, at the end of FY10.

The transaction still requires shareholder, regulatory and court approval, as well as the endorsement of an independent expert.

Metcash will be eligible for a $500,000 break fee if Mitre 10 directors withdraw their support, or if Mitre 10 shareholders refuse to sign off on the deal.

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Tags MetcashMitre 10Mergers and acquisitions

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