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Asda Taps Up Somerfield
The heat was turned up on the Somerfield front this month.
The heat was turned up on the Somerfield front this month after Asda appointed financial advisors Lazard to look into a possible offer for the retailer. This move will undoubtedly put pressure on the consortium currently in the running – a group including the property tycoon Robert Tchenguiz, the Icelandic investment group Baugur, the private equity firm Apax and Barclays Capital.
Somerfield initially rejected a £1.03bn offer from Baugur earlier in the year but since the formation of the consortium the retailer is back in talks, although keen to point out in a statement that “there can be no certainty that any offer will be forthcoming.”
It is even less clear if Asda, owned by the American giant Wal-Mart, will actually table a bid but reports in the Financial Times this month quoted sources “close to the situation” saying that the retailer was keen to increase its market share in the UK.
Any bid by Asda would in all likelihood, however, be referred to the Competition Commission, even though in the past the convenience sector and the supermarket sector have been treated separately. The issue would depend on which sector watchdogs believe Somerfield to be operating in.