J Sainsbury PLC (LON:SBRY) is the subject of takeover speculation again.

The catalyst was news that Czech billionaire Daniel Kretinsky has raised his stake in the supermarket from just over 3% to 9.99% through his Vesa investment group. He bought the extra shares over the weekend from the supermarket’s long term investor the Qatar Investment Authority, which as a result has reduced its own shareholding to 15.02%. Vesa originally bought shares at around 190p each last September.

Whether this does signal a possible bid is a moot point.

Analysts at UBS said: “QIA’s stake reduction from 22% to 15% seems to coincide with the simultaneous increase in Vesa stake of 3% to 10%. We see this as a small positive This removes a potential overhang of QIA stake as that is absorbed by a willing buyer who could look to raise the stake further and as such we see it as a modest positive.

“There was a brief statement from Vesa back in September when they said they saw Sainsbury as ‘an attractive investment opportunity for the long run’ fitting in with their key area of interest in food retail. We await any further such statement from Vesa and will look for any clues as to their intentions at this time.”

Sainsbury faced two bids in 2007 – from a private equity consortium and Qatari group Delta Two – but neither came to anything.

It’s own attempt to merge with Leed’s based Asda was blocked on competition grounds, but the subsequent purchase of Asda for £6.8bn by the Issa brothers put Sainsbury back in the takeover spotlight.

As for Vesa, it made a failed bid for German retailer Metro in 2019 and Kretinsky – who also owns Sparta Prague football club – has been building a stake in Royal Mail.

 

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