Three bidders circle grocery chain
THE Somerfield grocery chain could change hands for £1.8bn after three bidders were reported to be interested in acquiring the business.
The Bristol-based group, which has around 900 stores with dozens dotted across the North-East, is said to have received three offers in recent weeks.
Somerfield is owned by a consortium including property tycoon Robert Tchenguiz, private equity firm Apax and investment bank Barclays Capital following a £1.1bn takeover two years ago.
But possible buyers could include some of the UK’s biggest supermarkets such as Sainsbury’s, Morrisons and Asda, which are all looking to increase their town-centre store numbers to compete with market leader Tesco.
Somerfield has avoided competition with the major supermarkets by concentrating on local convenience stores.
But the chain’s owners are now set on a sale which could see the group carved up between the UK’s leading supermarkets, according to sources quoted by a Sunday newspaper.
A sale of Somerfield, which has been led by former Asda and Matalan chief executive Paul Mason since going private, would be a boost for Mr Tchenguiz, who has suffered recent losses as a major investor in Sainsbury’s.
The supermarket share price has collapsed by more than a third since November, when a proposed 600p a share approach from an investment vehicle backed by the Qatari royal family fell through.
A spokesman for Somerfield’s owners declined to comment on the report of bidders’ interest.
The chain began life in Bristol as JH Mills in 1875, growing to 14 stores and changing its name to Gateway in 1950 because the city was the ‘gateway to the West Country’.
It dropped the Gateway name in 1994, becoming Somerfield, before listing on the stock exchange two years later.
