Sainsbury shareholder QIA not happy about bid for HRG, could block deal
J Sainsbury [LON:SBRY] shareholder the Qatar Investment Authority (QIA) is unhappy with the UK-based supermarket group’s proposed offer for Home Retail Group [LON:HOME], The Guardian reported.
The newspaper cited unspecified sources who said the QIA was not pleased at the limited consultation regarding the offer and added the QIA’s relationship with Sainsbury’s since former CEO Justin King departed in 2014 has been less cordial.
It is understood that the QIA, holder of a 25.1% interest in Sainsbury’s, is not keen to see its stake in the group diluted and does not want to invest in a cash call to help finance the takeover, the report said. However, the QIA could yet support a deal if its concerns regarding dilution are addressed, the item added.
If Sainsbury’s offer is valued at more than 25% of its market capitalisation, shareholder approval would be required, the article continued. The QIA would, therefore, be strongly-placed to block the HRG deal.
The Sainsbury family, which holds a stake of about 3%, is believed to be supportive of the supermarket group’s management, according to the report.
Sainsbury’s disclosed this week that it had approached HRG regarding a possible takeover bid, but added that HRG had rejected the approach.
Home Retail Group’s market capitalisation stood at GBP 1.07bn (EUR 1.44bn) at the close of trading in London yesterday, 6 January.
The Guardian