UK supermarket group Somerfield has announced that it has rejected a conditional proposal relating to a possible offer for the company from retail entrepreneurs John Lovering and Bob Mackenzie

Somerfield said the 120p per share offer, which was conditional on a number of matters, substantially undervalued the company.

In April Somerfield rejected a 103p per share offer from Lovering and Mackenzie for the same reason.

Somerfield said the latest offer, received on 3 June, was subject to various conditions including: due diligence; unanimous approval of the Somerfield Board; financing; exclusivity and OFT clearance for J Sainsbury to acquire a large number of pre-selected Somerfield stores.

The group, which also operates the Kwik Save chain of stores, said it believes that the amended proposal presents considerable risks to the business. 

John von Spreckelsen, executive chairman, said: “This latest approach substantially undervalues our business.  We have strong brands in Somerfield and Kwik Save, a solid strategy for delivering shareholder value and excellent prospects.  The strategy is underpinned by a very strong balance sheet and a valuable property portfolio.”