The private equity consortium at the forefront of the bidding war for supermarket chain J Sainsbury will decide whether to abandon a possible £11 billion offer or proffer a formal bid for the retailer within eight days.
The decision, by Kohlberg Kravis Roberts, Blackstone and Texas Pacific Group, represents a dramatic turnaround for the consortium, which has seen matters move slowly in the month since bid plans were first announced.
As reported in The Independent, sources close to the deal claim that the desire to make a swift decision has stemmed from a wave of negative publicity associated with the bid.
There is also increasing speculation that Sainsbury’s, led by Justin King, will request the Takeover Panel imposes a ‘put-up or shut-up’ deadline to end uncertainty.
Buyout firms had until recently been content to wait before making a bid, in the hope that the target’s share price would ease. The retailer’s shares rocketed following the news of a possible bid last month, and stock is still 21 per cent higher than immediately before buyout firms showed their hands “That policy has been abandoned and there will be a decision within one week,” said one source.
Controversy has been sparked over the possible takeover, with unions led by the GMB mounting a fierce campaign, dubbing private equity firms “asset-strippers” and “casino capitalists”. Should the consortium place an offer, insiders believe the move could generate much more interest.
Marks & Spencer has ruled itself out of the bidding for six months, despite rumours fuelled last week by chief executive Stuart Rose. There is also still speculation over the potential involvement of current Royal Mail chairman Allan Leighton.
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