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Sainsbury's takeover plan dropped Sainsbury's takeover plan dropped
(about 1 hour later)
The private equity consortium that had been looking to buy Sainsbury's has said it is no longer considering making an offer for the UK supermarket group.The private equity consortium that had been looking to buy Sainsbury's has said it is no longer considering making an offer for the UK supermarket group.
CVC Capital Partners, Blackstone and TPG Capital said in a statement that "it became clear" the Sainsbury's board would not back their proposed offer.CVC Capital Partners, Blackstone and TPG Capital said in a statement that "it became clear" the Sainsbury's board would not back their proposed offer.
The consortium reportedly offered a bid of 582 pence per share, but reports said the Sainsbury family wanted more.The consortium reportedly offered a bid of 582 pence per share, but reports said the Sainsbury family wanted more.
Sainsbury's said it remained committed to its ongoing recovery plan.Sainsbury's said it remained committed to its ongoing recovery plan.
Shares in the supermarket fell 3% after the announcement from the consortium. Shares in the supermarket ended Wednesday trading down 2.3% to 526 pence after the announcement from the consortium.
'Nothing of value''Nothing of value'
The Sainsbury family, which owns 18% of the business, was reported to have wanted at least 600p per share, a price the consortium was said to be not prepared to reach.The Sainsbury family, which owns 18% of the business, was reported to have wanted at least 600p per share, a price the consortium was said to be not prepared to reach.
The approach was at all times friendly and constructive The CVC-led consortium Check Sainsbury's sharesThe approach was at all times friendly and constructive The CVC-led consortium Check Sainsbury's shares
A source close to the bid negotiations told the BBC that "Lord Sainsbury saw no reason to hand over something of value to people who brought absolutely nothing to the table".A source close to the bid negotiations told the BBC that "Lord Sainsbury saw no reason to hand over something of value to people who brought absolutely nothing to the table".
Sainsbury's said in a statement following the consortium's announcement that "the key preconditions [of the bid interest] were outside the control of the board and related to the consortium's proposed financing structure".Sainsbury's said in a statement following the consortium's announcement that "the key preconditions [of the bid interest] were outside the control of the board and related to the consortium's proposed financing structure".
News of the end of the bid interest in the UK's third-largest food retailer comes just over two months after the CVC-led consortium first revealed it was considering making an offer.News of the end of the bid interest in the UK's third-largest food retailer comes just over two months after the CVC-led consortium first revealed it was considering making an offer.
'Remain great admirers''Remain great admirers'
The consortium said in a statement that it had pledged a major investment programme for Sainsbury's, including extra jobs.The consortium said in a statement that it had pledged a major investment programme for Sainsbury's, including extra jobs.
Lord Sainsbury and his family are said to have wanted a higher priceLord Sainsbury and his family are said to have wanted a higher price
"The approach was at all times friendly and constructive," it said."The approach was at all times friendly and constructive," it said.
"We remain great admirers of Sainsbury's, its management and employees.""We remain great admirers of Sainsbury's, its management and employees."
Sainsbury's has proven an attractive takeover target as it continues with a successful three-year plan to turnaround its fortunes.Sainsbury's has proven an attractive takeover target as it continues with a successful three-year plan to turnaround its fortunes.
Led by chief executive Justin King, the supermarket recently reported better-than-expected sales figures for the first three months of 2007, with like-for-like sales, excluding petrol, up 5.9%.Led by chief executive Justin King, the supermarket recently reported better-than-expected sales figures for the first three months of 2007, with like-for-like sales, excluding petrol, up 5.9%.
Sainsbury's suffered a broker downgrade after the news that the consortium had pulled out.
Seymour Pierce now predicts that Sainsbury's shares could fall back as low as 420 pence.
It also predicted that Sainsbury's could now try and placate its shareholders by paying a special dividend or begin a share buyback programme.