U.K.'s Iceland Foods co-founder Malcolm Walker enlists GSO Capital Partners to finance his attempt to buy company; Morrisons and Asda also involved in Iceland bidding war

Allison Oesterle

LOS ANGELES , November 16, 2011 (Industry Intelligence) – Malcolm Walker, a co-founder of the U.K.-based supermarket chain Iceland Foods Ltd., has enlisted GSO Capital Partners LP to help him finance his offer to purchase the Iceland grocery store chain, the Telegraph reported on Nov. 14.

According to the article, GSO is rumored to have committed over £300m to Walker’s proposed Iceland deal.

A group of banks including Deutsche Bank AG, Goldman Sachs Group Inc., Lloyds TSB, Morgan Stanley & Co. and Royal Bank of Scotland Plc have also agreed to collaborate with Mr. Walker in his attempt to buy the Iceland grocery-store chain.

Despite GSO’s involvement, Mr. Walker still has not raised enough equity in order to purchase the chain. His management team needs to produce up to £600 million of equity in addition to their existing debt package of £900 million.

Even if Mr. Walker’s investment team is able to transfer their equity, they will still fall short of rival offers by grocery store chains Morrisons Supermarkets Plc. and Asda Stores Ltd.

Currently, Walker owns 4% of Iceland. Failed Icelandic bank Landsbanki owns 67%, Iceland management owns 23%, Icelandic bank Glitnir owns 10%, and the remaining 7% is held by Iceland director Andy Pritchard.

The primary source of this article is the Telegraph, London, on Nov. 14, 2011.

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