Sainsbury’s has been given until 18 March to consider whether it will return with a new bid for Home Retail Group, the owner of Argos, after its takeover attempt was gatecrashed by South Africa’s Steinhoff International. The supermarket sought an extension of the so-called “put up or shut up” deadline, previously set by City regulators for Tuesday 23 February, after Steinhoff tabled a surprise bid for Home Retail late on Friday. (The Guardian, The Daily Mail)
The FT’s Lex column suggests Sainsbury’s should be careful not to pay too much for the business. “Shoppers trading up to premium ranges get better quality products. Sainsbury’s would simply be paying more for the same thing. Its managers left themselves an exit route by saying they did not need a deal at any price. They should not be afraid to use it.” (The Financial Times £)
Home Retail, saw its shares surge to 173.7p by the close in London, surging past the 161.3p offer made by Sainsbury’s earlier this month. The price now stands less than 2p short of the all-cash offer announced by Steinhoff after the market closed on Friday (The Financial Times £, The Guardian)
Meanwhile, The boss of the South African conglomerate that has gatecrashed J Sainbury’s attempted takeover of Home Retail Group says that he is “very relaxed” about an investigation into its tax affairs in Germany. (The Times £)
There is also plenty of coverage this morning of Sysco buying Brakes for US$3.1bn. “The deal is among the largest so far this year to involve an overseas buyer acquiring a British company, and comes as business leaders are bracing themselves for the UK’s referendum on whether to leave the EU,” notes The Financial Times (£).The acquisition will allow Sysco to expand its business in the UK and Ireland and further into Europe, writes The Telegraph. Ken McMeikan, the Brakes chief executive, denied the group had ever entirely ruled out a float, saying he had been talking to potential IPO investors as recently as last Monday and that then “a fantastic offer came in”. (The Guardian)
Coverage of ABF’s half year trading updates focusses largely on Primark. The Financial Times (£) writes that Primark’s entry into the US since September was going well, with “encouraging” trading at the two stores opened so far in the Boston area, while The Daily Mail says “American dream is a reality for Primark”. The Guardian writes that budget fashion chain recovered from falling pre-Christmas sales caused by warm weather, though The Telegraph says it remains concerned over the rate of growth at Primark.The Times goes with the angle that rising sugar prices in Europe and China have helped to drive a “reassuring” performance at Associated British Foods. (The Times £)
The FT’s Lex column looks at Coca-Cola HBC, noting the company’s surprisingly optimistic results on Friday and that the company has plenty of cashflow, but it wonders what it plans to do with it. “Increasing the dividend is safer. An acquisition offers higher potential gains. CCH should make its preference clear, and soon.” (The Financial Times £)
One in five dairy farms in Britain could close this year because of the low price of milk products, the National Farmers Union has warned. The price of producing a litre of milk is about 28p, but farmers are receiving 21p or less from the big supermarkets, Rob Harrison, chairman of the NFU, said. A large number of his members are likely to have to close because they are unable to service mounting debts. (The Times £)
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