Formal talks begin on Sainsbury's takeover

The Qatar-backed fund circling UK retailer Sainsbury's said today that it was holding formal talks with the supermarket's pension fund guardians as it prepares a possible £10.6bn (€15.1bn) bid for the chain.

The Delta Two investment group, which has been stalking Sainsbury's since July, has signed a confidentiality agreement to exchange information with the pension trustees and its advisers.

The news comes after Sainsbury's revealed last week that it had opened its books to the Qatari fund.

Delta Two has reportedly already put together plans for the retailer's pension fund, but is said to be waiting for more specific details on the scheme before tabling an offer for the trustees.

The 85,000-member scheme is thought to be a potential sticking point in the takeover saga, with the scheme trustees believed to be preparing a similar campaign to that used in the Alliance Boots buy-out.