Editing Sainsbury's (section)

===Takeover bids (2007)===
On 2 February 2007, after months of speculation about a private equity bid, [[CVC Capital Partners]], [[Kohlberg Kravis Roberts]] (KKR) and [[Blackstone Group]] announced that they were considering a bid for Sainsbury's.<ref>{{cite news|title=Bid talk lifts Sainsbury's shares|url=http://news.bbc.co.uk/1/hi/business/6323371.stm|work=BBC News|date=2 February 2007|access-date=23 April 2007|archive-date=17 February 2007|archive-url=https://web.archive.org/web/20070217113929/http://news.bbc.co.uk/1/hi/business/6323371.stm|url-status=live}}</ref> The consortium grew to include [[Goldman Sachs]] and [[Texas Pacific Group]]. On 6 March 2007, with a formal bid yet to be tabled, the Takeover Panel issued a bid deadline of 13 April.<ref>{{cite news|first=Neelam|last=Verjee|author2=Hawkes, Steve|author3=Seib, Christine|title=Tchenguiz buys 3% Sainsbury's stake as consortium is hurried|work=[[The Times]]|page=48|date=7 March 2007}}</ref>

On 4 April, KKR left the consortium to focus on its bid for [[Alliance Boots]].<ref name="ftbid">{{cite news|first=Tom|last=Braithwaite|title=Private equity bid founders on family|work=Financial Times|page=15|date=14 April 2007|display-authors=etal}}</ref> On 5 April, the consortium submitted an "indicative offer" of 562p a share to the company's board. After discussions between Sir Philip Hampton and the two largest Sainsbury family shareholders [[Lord Sainsbury of Turville]] and [[Lord Sainsbury of Preston Candover]] the offer was rejected.<ref name="ftbid" /> On 9 April, the indicative offer was raised to 582p a share; however, this too was rejected. This meant the consortium could not satisfy its own preconditions for a bid, most importantly 75% shareholder support; the combined Sainsbury family holding at the time was 18%.<ref name="withdraw">{{cite news|first=Sarah|last=Butler|title=CVC withdraws £10&nbsp;billion offer for Sainsbury's|url=http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article1640537.ece|work=[[The Times]]|date=11 April 2007|access-date=23 April 2007|location=London|archive-date=11 June 2011|archive-url=https://web.archive.org/web/20110611211038/http://business.timesonline.co.uk/tol/business/industry_sectors/retailing/article1640537.ece|url-status=dead}}</ref>

Lord Sainsbury of Turville, who then held 7.75% of Sainsbury's, stated that he could see no reason why the Sainsbury's board would even consider opening its books for due diligence for anything less than 600p per share.<ref name="intervene">{{cite news|first=James|last=Moore|title=Sainsbury family intervenes in bid|url=https://www.independent.co.uk/news/business/news/sainsbury-family-intervenes-in-bid-443624.html|work=The Independent|date=6 April 2007|access-date=11 November 2008|location=London}}</ref> Lord Sainsbury of Preston Candover, with just under 3%, was more extreme than his cousin, and refused to sell at any price.<ref>{{cite news|title=Sainsbury deadlock as family holds out|url=http://www.ft.com/cms/s/0/eecce54a-e6ff-11db-9034-000b5df10621.html|work=Financial Times|date=10 April 2007|access-date=11 November 2008|archive-date=24 September 2015|archive-url=https://web.archive.org/web/20150924150812/http://www.ft.com/cms/s/0/eecce54a-e6ff-11db-9034-000b5df10621.html|url-status=live}}</ref> He believed any offer at that stage of Sainsbury's recovery was likely to undervalue the business,<ref name="intervene" /> and with private equity seeking high returns on their investments, saw no reason to sell, given that the current management, led by Justin King, could deliver the extra profit generated for the benefit of existing investors.<ref>{{cite news|title=Sainsbury must now justify the revaluation which private equity bid has sparked|url=https://www.independent.co.uk/news/business/comment/jeremy-warners-outlook-sainsbury-must-now-justify-the-revaluation-which-the-private-equity-bid-has-sparked-444335.html|work=The Independent|date=12 April 2007|access-date=11 November 2008|location=London}}</ref> He claimed the bid 'brought nothing to the business', and that high levels of debt would significantly weaken the company and its competitive position in the long term, which would have an adverse effect on Sainsbury's stakeholders.<ref>{{cite news|first=Harry|last=Wallop|title=Lord Sainsbury speaks out over equity bid|url=https://www.telegraph.co.uk/finance/2807202/Lord-Sainsbury-speaks-out-over-equity-bid.html |archive-url=https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/2807202/Lord-Sainsbury-speaks-out-over-equity-bid.html |archive-date=12 January 2022 |url-access=subscription |url-status=live|work=The Daily Telegraph|date=13 April 2007|access-date=11 November 2008|location=London}}{{cbignore}}</ref> On 11 April, the CVC-led consortium abandoned its offer, stating that "it became clear the consortium would be unable to make a proposal that would result in a successful offer."<ref name="withdraw" />

In May 2007, Sainsbury's identified five areas of growth: Growth of non-food ranges; opening of new convenience shops and growth of online home delivery and banking operations; Expansion of supermarket space through new shops and development of the company's "largely underdeveloped shop portfolio"; and "active property management".<ref>{{cite web|title=Corporate overview|url=http://www.j-sainsbury.co.uk/index.asp?pageid=12|publisher=Sainsbury's|access-date=11 November 2008|url-status=dead|archive-url=https://web.archive.org/web/20081023054607/http://www.j-sainsbury.co.uk/index.asp?pageid=12|archive-date=23 October 2008 }}</ref>

On 25 April 2007, Delta Two, a Qatari investment company, bought a 14% stake in Sainsbury's causing its share price to rise 7.17%, and then increased its holding to 17.6%. Its interest in Sainsbury's is thought to centre on its property portfolio. It increased its stake to 25% in June 2007.<ref>{{cite news|title=Huge share deal lifts Sainsbury's|work=BBC News|date=25 April 2007|url=http://news.bbc.co.uk/1/hi/business/6590879.stm|access-date=9 November 2008|archive-date=6 October 2007|archive-url=https://web.archive.org/web/20071006020243/http://news.bbc.co.uk/1/hi/business/6590879.stm|url-status=live}}</ref> On 18 July 2007, BBC News reported that Delta Two had tabled a conditional bid proposal.<ref>{{cite news|title=Qatar firm tables Sainsbury's bid|work=BBC News|date=18 July 2007|url=http://news.bbc.co.uk/1/hi/business/6905040.stm|access-date=9 November 2008|archive-date=18 August 2007|archive-url=https://web.archive.org/web/20070818064823/http://news.bbc.co.uk/1/hi/business/6905040.stm|url-status=live}}</ref> Paul Taylor, the principal of Delta Two, flew David and John Sainsbury to [[Sardinia]] to reveal and discuss the potential bid which amounted to 600p per share.<ref>{{cite news|title=Shopping for Sainsbury's|work=[[The Times]]|date=22 July 2007|url=https://www.thetimes.com/travel/destinations/middle-east-travel/qatar/shopping-for-sainsburys-gdg5mx35rq7|access-date=9 November 2008|location=London|first=Jenny|last=Davey|archive-date=2 May 2018|archive-url=https://web.archive.org/web/20180502211827/https://www.thetimes.co.uk/article/shopping-for-sainsburys-gdg5mx35rq7|url-status=live}}</ref>

The family had reservations about the price of the bid. They were also concerned about the proposed structure, which involved splitting the business into an operating company and a highly leveraged property company. They were additionally concerned about adequacy of funding, both for the bid and for the company's pension scheme.<ref>{{cite news|title=Sainsbury family still reluctant to sell|work=The Daily Telegraph|date=24 September 2007|url=https://www.telegraph.co.uk/finance/markets/2816347/Sainsbury-family-still-reluctant-to-sell.html |archive-url=https://ghostarchive.org/archive/20220112/https://www.telegraph.co.uk/finance/markets/2816347/Sainsbury-family-still-reluctant-to-sell.html |archive-date=12 January 2022 |url-access=subscription |url-status=live|access-date=9 November 2008|location=London|first=James|last=Hall}}{{cbignore}}</ref> On 5 November 2007, it was announced Delta Two had abandoned its takeover bid due to the "[[credit crunch|deterioration of credit markets]]" and concerns about funding the company's pension scheme.<ref>{{cite news|title=Sainsbury's takeover bid dropped|work=BBC News|date=5 November 2007|url=http://news.bbc.co.uk/1/hi/business/7078441.stm|access-date=9 November 2008|archive-date=19 July 2022|archive-url=https://web.archive.org/web/20220719015247/http://news.bbc.co.uk/1/hi/business/7078441.stm|url-status=live}}</ref>