Asda is sounding out potential partners for a carve up of 900-store local grocery chain Somerfield, according to the Daily Telegraph.
Asda has made an indicate offer bid for Somerfield, as reported by Retail Week (February 15). It is understood that Asda is interested in about two thirds of its 900 stores, while the Co-operative Group wants most of the estate.
Somerfield’s owners – Barclays Capital, private equity group Apax Partners and property entrepreneur Robert Tchenguiz – had hoped to secure an offer of between£2 billion and£2.5 billion for the entire business, but industry sources are sceptical about it achieving this price.
Asda, which has 347 stores, is talking to other retailers about selling Somerfield’s smaller town centre stores.
The Co-operative Group has appointed investment bank Credit Suisse to assess its options for the retailer.
Somerfield was bought for£1.8 billion by the private equity consortium in December 2005. It made a pre-tax profit of£26.4 million for the year to April 28 2007.