Marks & Spencer executives have reportedly been discussing a bid for Sainsbury’s.
The Times reported today [Thursday] that internal discussions are ongoing and M&S had not appointed bankers to work on a possible deal.
"Everyone has been looking at it. I would be surprised if (French supermarket giant) Carrefour aren't looking at it," the paper quoted an unnamed source as saying.
Possible advantages for M&S of joining forces with Sainsbury included gaining access to the firm's property portfolio.
The joke is also doing the rounds that brand-wise the M&S name would still fit - Marks & Sainsbury.
A spokeswoman for M&S declined to comment on the report. Sainsbury’s was also not immediately available for comment.
Sainsbury’s, the UK's third largest supermarket group, has become a potential takeover target after a trio of private equity investors, CVC Capital Partners, Kohlberg Kravis Roberts and Blackstone, confirmed they were weighing up the possibility of a takeover offer.
The prospect of a bidding war was fuelled when later reports also linked the private equity firms Cinven and Texas Pacific Group.
Shares in M&S dipped in early trading today, although commentators were sceptical. Exane BNP analyst Tim Attenborough said: "A tie-up between the two just doesn't make any sense to my mind. What could they lend to each other, apart from an online operation? I would expect the market to ignore this."
Seymour Pierce analyst Richard Ratner was also doubtful that M&S would bid. "It does seem very far-fetched to us," he said.
