The approach is subject to a period of due diligence, but one analyst's note said Baugur's reputation of achieving what it sets out to do makes a formal offer likely. A statement from broker Numis said: 'We believe there is a better chance of this leading to a proper bid than, say, Apax's interest in Woolworths.' One analyst said the bid made sense if Baugur intended to build up a sizeable UK grocery offer.
Seymour Pierce analyst Richard Ratner said: 'Baugur must be looking at putting Somerfield together with its recent acquisition, Big Food Group, to create a significant food retail operation that offers substantial cost savings and buying synergies.'
Somerfield recorded a pre-tax profit of£26.2 million for the year ending April last year. The company's shares rose 13 per cent to 183p this morning.