TESCO is to go ahead with ambitious plans to expand Dobbies Garden Centres following yesterday's agreement to buy out billionaire Tom Hunter's stake in the company.
The move paves the way for Tesco to increase the number of stores from the current 24 to 100 over the next 10 years.
A spokesman for Tesco said the supermarket chain had no plans to alter Dobbies' future strategy. The name will remain as Dobbies w
ith no mention of Tesco's ownership of the company.
Sir Tom, Scotland's richest man, failed last week to block a planned rights issue of shares by Dobbies which would have forced him to spend £44m to retain his 29.2 per cent blocking stake.
Tesco, which already owns about 65.5 per cent of Dobbies, has offered 1,200p per share in cash for the remaining shares, valuing Britain's third-largest garden centre company at about £124.5m.
The offer is well below the 1,500p Tesco offered for Dobbies last year and the 1,750p per share Sir Tom paid for a 10 per cent stake last June.
Dobbies is awaiting planning permission from the City of York Council to build an £8m Garden World at Fulford, York.
It is intended to include a farm food hall selling locally-sourced fresh and organic produce.
Last year it opened a £12m combined garden centre and retail complex at Barlborough Links, just outside Sheffield.
Tesco said Sir Tom, who owns his 29.2 per cent stake in Dobbies via investment vehicle West Coast Capital, had agreed to accept its offer. The deal will give Tesco a 94.7 per cent stake in the company. Sir Tom will receive £36.3m for his stake.
West Coast Capital controls around 110 garden centres in Britain including Dobbies' rivals Wyevale and the Blooms of Bressingham chain.
Sir Tom resisted Tesco's previous offer for Dobbies last year and progressively raised his stake in an attempt to prevent Tesco strengthening its grip on the company.
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