Blog: Sainsbury's reappears on the M&A rumour mill
Dean Best | 8 December 2014
Crystal Amber is said to have concluded Sainsbury's could sell off some stores
The UK's third-largest grocer has returned to the M&A headlines over the weekend, with claims activist fund Crystal Amber is in discussions with overseas investors about a possible bid for the retailer.
According to The Daily Telegraph, Crystal Amber was approached earlier this year by a mystery US investor eyeing a stake in Sainsbury's.
Those discussions have led Crystal Amber to draw up a dossier on Sainsbury's to examine the options it sees available for the business to increase value for shareholders.
The fund is looking at buying shares in Sainsbury's but, the report said, it is seen as unlikely to have the firepower to force through change at the business - so is in discussions with investors to see if there is takeover interest in the retailer.
The Daily Telegraph says the dossier concludes that if a takeover bid for the business does not materialise Sainsbury's could release funds through selling and leasing back some of its property.
The Qatar Investment Authority is the largest investor on the Sainsbury's roster, owning just over a quarter of the business.
In July 2007, Qatar tabled a GBP10.6bn bid for Sainsbury's, although it withdrew the offer five months later, blaming the global credit crunch, among other factors.
Since then, the QIA, which owns 26% of Sainsbury's, has periodically been linked to mounting a takeover bid for the rest of the business.
Shares in Sainsbury's have fallen over 35% since the start of the year amid pressure on sales and concerns over increased competition from the likes of Aldi and Lidl and, crucially, whether larger rival Tesco will launch a significant offensive on price under new CEO Dave Lewis.
Officials at Crystal Amber could not be reached for comment at the time of writing.
More to follow.....
Danone completed its US$12.5bn acquisition of WhiteWave Foods this week. The move will roughly double Danone's presence in North America, where WhiteWave is a top four dairy player. ...
Premier Foods plc revealed today (28 March) it has secured a deal with its pension scheme trustees that will see the UK food maker reduce its pension burden....
Hain Celestial, under the scrutiny of the investment community in recent months and facing some challenges in its domestic market, has announced another shuffling of its management pack....
Sfoglia Torino has taken a further step in its strategy to consolidate Italy's frozen puff pastry sector with the 100% acquisition of counterpart Idea Quick....
FrieslandCampina, which today served up higher profits but lower sales for 2016, is ready to offload the last non-dairy business owned by the Dutch cooperative giant....
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