Wm Morrison is thought to be lowering its bid in the race to buy supermarket Safeway.

Experts believe that Safeway is likely to accept a reduced offer, as its sales have declined in the last nine-months.

The Department of Trade and Industry will decide on potential bids from Tesco, Sainsbury's, Asda and Wm Morrison in September, but the process could go on into next year.

Morrison's original offer for Safeway, in January, collapsed, but experts believe the group is now in a better position to buy the supermarket.

Safeway stated that the nine-month takeover meant it was not trading as it would wish.

Experts have warned that too much haggling by Morrison's could lead to strained relations.

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