There is “strong opposition” among workers at UK retailer Sainsbury’s to a possible takeover by Qatari-backed investment fund Delta Two, according to the UK’s largest trade union.
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Unite claimed that reports across its 20,000 members at Sainsbury’s showed hostility towards a possible sale.
Brian Revell, Unite national organiser for food and agriculture, said Sainsbury’s workers fear that Delta Two, the investment vehicle of the Qatari royal family would “act just like private equity”.
There has been speculation that Delta Two could be forced to raise the equity element included in its GBP10.6bn (US$21.1bn) proposed offer.
Delta Two has said it would fund the offer with an investment of GBP4.6bn in equity and shares. The fund plans to fund the balance through securing debt finance of some GBP6bn.
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By GlobalDataHowever, the recent turmoil in credit markets has led to suggestions that Delta Two would find it difficult to raise the finance for any formal bid for the UK’s third-largest retailer.
Delta Two refused to be drawn on the funding in place behind its proposal. However, the fund moved to reassure Sainsbury’s that its plans are “focused on growth, not retrenchment”.
“We note Unite’s comments and appreciate that the current period in which we are considering an offer for Sainsbury is unsettling for staff,” a Delta Two spokesman said.
“However, we have previously commented that we have a high regard for the board, management and employees of Sainsbury and are supportive of the company’s operational strategy. Our proposal is focused on growth, not retrenchment.
“It is backed by a shareholder with the resources and commitment to continue to improve Sainsbury’s market position in the UK with its reputation for quality and innovative food at competitive prices.”
Discussions between the two sides are said to be taking place daily. Officials at Sainsbury’s could not be reached for immediate comment.
