Safeway Bidders Await Competition Ruling

18 March 2003

The five bidders for British supermarket Safeway should discover this week if their offers are to be referred to the Competition Commission.

Although rival chain Morrisons is the only party to have made a firm bid, the Office of Fair Trading has been investigating the interest shown by supermarket ‘big three’ Tesco, J Sainsbury and Wal-Mart-owned Asda, as well as by retail entrepreneur Philip Green.

The OFT has reported to the Department of Trade and Industry, which is due to announce in the next few days whether any offers are to be referred to the anti-trust watchdog. It is thought the Competition Commission will take some interest as Safeway controls a significant chunk of Britain’s supermarket sector.

The delay in the announcement is being exploited by Wal-Mart, which is the only party still allowed to buy Safeway shares. The US giant is reportedly seeking a sizeable portion of the supermarket’s stock, possibly so it can block rival bids. It can continue buying shares until its offer is passed to the Competition Commission.

Data sourced from: BBC Online Business News (UK); additional content by WARC staff