New bid on cards for Sainsbury's –

New bid on cards for Sainsbury’s Published:  15 June, 2007

SPECULATION about another takeover bid for the supermarket group J Sainsbury, which describes itself as Britain’s largest fishmonger, surfaced again today.

Shares in the company shot up after a group closely linked to the Qatari Royal Family said it now owned a quarter of all the shares in the chain and had a greater stake than the Sainsbury family itself which successfully blocked a private equity takeover bid in April.

The family’s investment vehicle, Delta Two, announced it had bought 123 million Sainsbury’s shares at 595 pence per share, making £732m in all.

The announcement boosted expectations that the company will come under renewed pressure to raise cash by selling off its property assets.

That represented just over seven per cent of the company and took the Royal Family’s holding to the largest block of any group.

Delta would have to make a formal bid if its holding increases by just another four per cent – to 29 per cent. delta is run by Paul Taylor, the former chief executive of a property company owned by the Iranian born billionaire Tchenguiz brothers. One of the, Robert Tchenguiz also has a stake of five per cent in Sainsbury’s, and has made it clear he would like the group to split off its property assets to release value for its shareholders.

But Sainsbury’s itself has been at pains to distance itself from any spin-off of its property, arguing that its value was closely tied to retail operations. Also some observers are in agreement with this. The bank ABN Amro said it did not think anyone – management or outside investors – could unlock value from property “without hindering the group’s recovery and competitive capability”.

When in May it announced full-year profits of £380m, Sainsbury’s said its property holdings were worth £8.6billion, 65 per cent more than earlier estimates.

Sainsbury’s has over 770 stores around the UK, employing 155,000 people and is probably the largest fish buyer in the country with major suppliers based on the Humber and in Scotland.

The Qatari royal family first unveiled its interest in Sainsbury’s when in April Delta Two announced it had bought 17.6 per cent of the group just after the private equity bid had been rebuffed.. is published by Special Publications. Special Publications also publish FISHupdate magazine, Fish Farmer, the Fish Industry Yearbook, the Scottish Seafood Processors Federation Diary, the Fish Farmer Handbook and a range of wallplanners.