Hewitt to decide next week on Safeway bids
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Your support makes all the difference.The five potential predators for the £3bn Safeway supermarket chain will learn next week whether the Government intends to order a lengthy competition investigation into their proposed takeover offers.
The decision by Patricia Hewitt, the Secretary of State for Trade and Industry, will be based on a recommendation by the Office of Fair Trading which she received yesterday.
Analysts said the Bradford-based chain William Morrison – the only group to have tabled a formal offer for Safeway, worth about £2.3bn – stood the most chance of escaping a referral to the Competition Commission. Philip Green, the entrepreneur who owns Bhs and a rival bidder, also hopes to avoid the three-month inquiry. "The most likely scenario has to be that everybody gets referred to the Competition Commission," Mark Hughes, a retail analyst at Numis, said.
Sources close to the situation said Morrisons and Mr Green could fall into the "minded to refer" camp, which would give them four to six weeks to negotiate with the Department of Trade and Industry by offering to dispose of certain Safeway stores.
Britain's top three supermarket chains, Tesco, J Sainsbury and the Wal-Mart-owned Asda, have all made indicative takeover proposals. None of the three expects to avoid referral because a deal to acquire Safeway would reduce the number of big players from four to three. The DTI has six working days to consider its decision, making an announcement likely towards the end of next week.
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