Sainsburys Takeover Bid Edges Closer

Shares in J Sainsbury increased yesterday following the news that investment firm Delta Two had agreed to raise the cash component of its £10.6 billion bid for the supermarket giant.
Sainsbury’s, the UK’s third largest supermarket chain, was close to opening its books to the Qatari backed investment fund, with some parties involved in the deal expecting due diligence to start by the end of next week, according to The Financial Times .
Meanwhile The Independent reported that the exact amount of the cash component had yet to be agreed but could be around £500 million and that the move could potentially remove one of the controversial factors of the deal .
The supermarket’s board members were understood to have been unhappy with the amount of debt proposed in the original deal, with the initial opposition to the highly leveraged deal raising concerns over whether the buyout would be a success .
Sainsbury’s share price closed yesterday at 540p – below the 600p offered by Delta Two.

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