Sainsbury's shares up 15% as it strikes deal to acquire Asda

Compact Could Co-op and Morrisons become the next supermarkets to join forces

Compact Could Co-op and Morrisons become the next supermarkets to join forces

The deal marks an ambitious attempt to reshape the United Kingdom retail market, in which the traditional big four retailers - Tesco, Sainsbury's, Asda and Morrisons - have come under pressure from German discount chains Lidl and Aldi in food, and from homegrown rivals along with internet retailers such as Amazon in general merchandise. "As a company, we've benefited from doing business in the United Kingdom for many years, and we look forward to working closely with Sainsbury's to deliver the benefits of the combination".

News of the tie-up sent Sainsbury's share price surging 14.5 percent to 309 pence by the close of trading in London.

Under the terms of transaction, Bentonville, Ark. -based Walmart would hold 42 percent of the share capital of the merged business.

Sainsbury's CEO, Mike Coupe, has been filmed singing and humming "We're in the Money" while waiting for an ITV News interview about his supermarket's merger with competitor Asda.

"It was an unfortunate choice of song, from the musical 42nd Street which I saw previous year and I apologise if I have offended anyone", Mr Coupe said.

The two companies said: "The retail sector is going through significant and rapid change as customer shopping habits continue to evolve".

The two companies had combined revenues of more than 70 billion USA dollars for 2017.

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Ford made $119 million from its European business, and lost money in South America, Middle East and Africa and Asia Pacific. Shanks said North American operations had been hurt by rising costs for key commodities such as steel and aluminum.

"This proposed merger represents a unique and bold opportunity, consistent with our strategy of looking for new ways to drive global growth", addedJudith McKenna, president and CEO of Walmart worldwide.

Instead, he said cost savings of at least £500m would allow the new group, which will account for almost £1 in every three £3 spent on groceries, to reduce prices by a tenth on many "everyday items".

It would meanwhile have a combined 24 percent of the British grocery market, beating Tesco on 22 percent, according to data published by retail consultancy Euromonitor.

The last big deal by Sainsbury's, which has a market value of £5.9 billion, was its £1.4 billion purchase of Argos in 2016.

At the same time, Amazon has ramped up its "Fresh" delivery service in Britain, amid speculation that it could decide to buy a United Kingdom supermarket group.

Sainsbury's opened its first shop in London in 1869, with the family business climbing to become one of the biggest store names in Britain.

Glencore dropped 5 per cent after mining subsidiaries in the Democratic Republic of Congo were served freezing orders for alleged unpaid royalties of almost US$3 billion.

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