Key food players fire off threat of fresh price wars

Renewed food price wars are expected no matter who wins the scramble for Safeway.

Wal-Mart, Sainsbury's and Morrisons have all promised lower prices for Safeway shoppers if they win control.

In Asda's announcement to bid, chief executive Tony De Nunzio claimed that its prices are 12 per cent lower than the average supermarket.

Sainsbury's assistant managing director Sara Weller said prices in Safeway stores will be cut by 4.7 per cent to Sainsbury's levels, while Morrisons claimed its EDLP strategy would ensure lower prices.

Numis analyst Mark Hughes said the losers are likely to cut prices aggressively locally to put pressure on the eventual Safeway victor.