How the papers see the battle for Safeway – the story so far
The UK's broadsheets have been falling over themselves to bring us the latest instalments in the tussle for Safeway. Andrew Don looks back at the first 13 days.
The heavies love a bid battle.
They came into their own when Sir Ken Morrison unveiled an agreed £2.5bn (US$4.1bn) bid for the fourth-biggest grocery chain on 9 January this year. The Daily Telegraph told us the following day how Merrill Lynch analyst Andrew Fowler thought the possibility of a bidding war "remote", his second clanger in as many days. Only the night before the bid, he wrote: "We say again - We think any bid unlikely."
Lombard in the Financial Times (FT) speculated about the effect on the share price if 71-year-old Sir Ken Morrison died a month after the takeover was consummated. It acknowledged, however, "he seems in robust physical and mental health".
Broadsheets full of praise for 'feisty' Sir Ken
All the newspapers fawned over Sir Ken. They described him variously as feisty, forthright, thrifty, revered, canny, bluff and uncompromisingly gruff.
The Independent reproduced his pearls of wisdom, Confucius-style, with gems that included: "If in doubt, have a cup of tea." Sir Ken apparently learnt the trade working in his father's warehouse…from the age of five, the newspaper told us.
Jeremy Warner, in The Independent's Outlook column, thought Sir Ken's shot at glory was perhaps attributable to his marriage to a woman little more than half his age. Indeed, Jeff Randall would later write in The Daily Telegraph that Sir Ken, who recently became a father again, had "no shortage of lead" in his pencil.
Seeing alliances everywhere
The Guardian suggested Asda would launch a joint counter-bid with Sainsbury's.
The story developed on 11 January when the nationals reported that Asda and Sainsbury's were working on separate bids for Safeway. The Daily Telegraph reported rumours that Kohlberg Kravis Roberts (KKR) was looking to partner a bid with Sainsbury's.
By 12 January, most of the Sunday papers had decided Wal-Mart was going to do battle with Sainsbury's, without mention of a partnership with KKR.
The Sunday Times suggested dissention in the Sainsbury's ranks on whether to mount a bid. It introduced Allan Leighton, former chief executive of Asda, and Carrefour as other parties considering offers.
Sainsbury's declared its hand the next day indicating it was willing to bid £3.2bn and on the 14 January we were told that Wal-Mart was expected to declare its interest. Merrill Lynch's Andrew Fowler said in the FT he could not see Sainsbury's winning - a safe statement to make considering his previous faux pas.
More parties enter the fray
Newspapers started to report the odds. The FT quoted bookmaker Blue Square, which put Sainsbury's at odds of 8/11 to win, Morrison 5/2 and Wal-Mart 11/4. The Times raised the subject of KKR again, this time in cohorts with Wal-Mart. Sainsbury's, led by Sir Peter Davis, a man with "more headaches than a migraine clinic", according to Jeff Randall, was also said to be considering a variety of deals with rivals to placate the competition authorities.
Meanwhile, The Independent and The Guardian reported that a cash bid from Wal-Mart was imminent.
The Times reported on 15 January that Tesco was considering plans to buy a clutch of smaller Safeway stores to scupper rivals' attempts to take control of Morrison. Patience Wheatcroft said not to put it past Tesco chief Sir Terry Leahy to come out on top. The reason: "A man who can sell as many DVDs as he did when Dixons had a lousy Christmas is not to be underestimated."
And Wal-Mart finally said it was considering an all-cash bid.
On 17 January, The Times quoted Malcom Hepworth, chief operating officer of Co-op group, saying the group would be interested in buying up to 35 of Safeway's smaller stores.
The next day, the FT said that former Asda chairman Archie Norman was advising KKR and that he wanted to team up with his old lieutenant, Allan Leighton. The Times reported confirmation from KKR that it was considering a bid.
On 19 January, The Sunday Times said Bhs billionaire Philip Green planned to bid more than £3bn. Mary Riddell in The Observer wailed that "the high street is slowly being devoured before our eyes."
The newspaper claimed that Wal-Mart was plotting a £5bn knockout bid, and working that very weekend with Jeff Cohen, a high-flying banker at Wasserstein Pirella in New York.
The Sunday Telegraph reported that "friends" of Archie Norman had said he was not involved in the bidding process and that Allan Leighton had told "friends" he, too, had no involvement with KKR. The Business insisted KKR had Norman and Leighton in the frame to run a re-invigorated Safeway.
Is the whole affair being stage-managed by Sir Ken?
The most intriguing comment of the whole affair appeared in Benchmark in The Business the same Sunday. "Of course there is one way for Ken [Morrison] to revive the shares. He can put the company up for sale."
Heaven forbid it was hinting he had stage-managed the whole affair to jack up the Morrison's share price in the hope that he would be able to bail out during his eighth decade to add more millions to his family's billion-plus pot.
Philip Green confirmed he was considering a cash offer for Safeway on 21 January. The Independent said Morrison was considering sweetening his bid by adding a cash element. It also emerged that Allan Leighton was now assisting Green.
Jeremy Warner in the newspaper's Outlook column captured the media frenzy perfectly when he wrote: "A sixth potential bidder is about to enter the battle for control of Safeway. I can exclusively reveal. Yes, it is me."
The FT dredged up Lord McLaurin, the former Tesco chairman, who it said had been approached by several possible bidders who wanted him to act as an adviser.
The next day several nationals reported that Texas Pacific was considering getting involved.
Then on the 23 January came the report that Tesco said it was considering an offer, turning the battle into a six-way struggle in which just one party has so far tabled a bid - an irascible Yorkshireman who still does his own shopping.
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