Morrisons has rejected a £5.5bn takeover bid from a private equity firm, believing it would have “significantly undervalued” the company. Private equity firm Clayton, Dubilier & Rice (CD&R) had earlier said it was considering a possible cash offer for the supermarket chain. Morrisons said it rejected a conditional cash offer from CD&R of 230p per share – which amounts to just over £5.5bn. Morrisons said: “The board of Morrisons evaluated the conditional proposal together with its financial adviser, Rothschild & Co, and unanimously concluded that the conditional proposal significantly undervalued Morrisons and its future prospects. “Accordingly, the board rejected the conditional proposal on 17 June 2021.” CD&R had earlier said in a statement that it “notes the press speculation regarding a potential transaction involving Morrisons and confirms that it is considering a possible cash offer for the issued and to be issued share capital of Morrisons”. It said there was no certainty an offer would be made. CD&R’s statement followed a Sky News report that it had made a preliminary bid approach to the supermarket group’s board that could value Morrisons at £5.5bn. Bradford-based Morrisons is Britain’s fourth-largest grocer by sales, trailing market leaders Tesco, Sainsbury’s and Asda. Shares in Morrisons, down 3% over the last year, closed on Friday at 182p, valuing the group at £4.33bn. A bid for Morrisons would have followed Walmart’s recent sale of a majority stake in Asda to the Issa brothers and private equity firm TDR Capital. That deal valued Asda at £6.8bn and followed Sainsbury’s failure to take over Asda after an agreed deal was blocked by Britain’s competition regulator in 2019. Morrisons has a partnership agreement with Amazon and there has been persistent speculation that it could emerge as a possible bidder.