Somerfield linked to Kwik Save sale

The new owners of Somerfield were today reported to have hoisted the for-sale sign above its loss-making Kwik Save chain.

Talks are taking place with a number of potential buyers of the loss-making business which could be broken up and stores sold in batches, the Daily Telegraph reported.

Somerfield was bought for £1.1bn (€1.6bn) late last year by a consortium featuring property tycoon Robert Tchenguiz, private equity firm Apax and investment bank Barclays Capital.

They have already rung the changes by parachuting in a new management team headed by former Asda managing director Paul Mason and setting in motion a review of “underperforming and unprofitable” product lines.

A spokesman for Somerfield today declined to respond to the report that Kwik Save was up for sale, saying that the company did not comment on speculation.

According to the Daily Telegraph, Icelandic retail group Baugur has already cherry-picked a number of stores that could be merged with its Iceland chain of supermarkets.

Baugur was originally keen to buy the entire Somerfield business and fired the gun on the takeover race last year before dropping out when fraud charges were brought against its chief executive, Jon Sager Johannes son. He was later cleared of the bulk of the charges.

Today’s report also stated that European discount chains Adi, Net to and Lidl have snapped up a few stores.

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