Clayton Dubilier & Rice To Acquire Significant Stake in Leading UK Variety Retailer, B&M Retail

Monday, December 3, 2012

Clayton, Dubilier & Rice, LLC (“CD&R”) and B&M Retail Ltd (“B&M” or the “Company”) today announced that funds managed by CD&R have agreed to acquire a significant stake in the parent company of B&M. Terms were not disclosed.

B&M, owned by the Arora family, is one of the UK’s leading discount retailers with stores situated in the north of England, Scotland, Northern Ireland and Wales. B&M will continue to be managed by its existing management team. Since its acquisition in 2005, the business has grown rapidly to over 300 stores, with sales in excess of £1 billion and employing over 10,000 people. Its stores attract over two million customers per week with a value offer of food and non-food products.

“B&M is a fantastic retail format in the growing discount sector,” said David Novak, a Partner at CD&R. “We are pleased to have the opportunity to partner with the management team to accelerate the growth of the business by widening its market presence outside of the UK, and continue to build the B&M brand. We believe the value based general merchandise retail model could have significant appeal in overseas markets.”

Simon, Bobby and Robin Arora, owners of B&M Retail, commented: “We are delighted to have the opportunity to partner with CD&R. We are proud of the success we have had with B&M since acquiring it in 2005, but recognise that we need a partner to bring the expertise to ensure the business fulfils its overseas potential. CD&R has very relevant retail sector experience and a strong track record of working in partnership with management teams to successfully grow businesses across different territories.”

Don Gogel, Chairman and CEO of CD&R commented: “The Aroras are exceptional entrepreneurs who have done a great job building a business that is trusted and supported by loyal customers. B&M has excellent opportunities for growth and we look forward to working with them to help the Company realize its prospects.”

Sir Terry Leahy, a senior operating adviser at CD&R, will serve as Chairman. He was previously the chief executive of Tesco plc. He will be joined on the board by Vindi Banga, the former President of Foods, Home and Personal Care and member of the Unilever plc Executive Board. Marco Herbst and David Novak of CD&R will also join the Board.

CD&R was advised by Bank of America Merrill Lynch, Clifford Chance, Debevoise & Plimpton, Ernst & Young and Bain & Co. B&M was advised by Rothschild, Allen & Overy, PWC and OC&C.