The board of Sainsbury’s is being urged to back out of takeover talks by the country’s largest union.
Unite has called for the retailer to shelve any plans to accept a £10.4 billion bid by Qatar-based investment fund Delta Two.
Unite, formed from the Transport & General Workers and Amicus unions, has around 20,000 members in the employment of Sainsbury’s and was vocal in its opposition to the failed private equity bid for Sainsbury’s earlier this year.
Unite's national organiser for food and agriculture, Brian Revell, believes the Delta Two proposal would have similar implications. "There is every fear Delta Two will act just like private equity," he said in a statement.
If the board backed the proposed bid, the union would take it up with Britain's Competition Commission, Revell said.
Delta Two already owns a quarter of Sainsbury’s shares, but it is struggling to gain the board's backing for its debt-heavy proposal due to the turbulence in the credit market, insiders have said.
The City is losing faith in the deal and Sainsbury’s shares have lost value in recent days. Pali International analyst Nick Bubb in a note gave the deal only a 40 per cent chance of success and said that on that basis the shares were overvalued and should trade close to 500 pence.
