Daily Mail

Sainsbury’s to buy rival amid Amazon panic

- by James Burton

SAINSBURY’S is set to swoop on convenienc­e chain Nisa in a £ 130m deal, amid panic over a possible sector invasion by Amazon.

The web giant shocked markets on Friday by announcing an audacious plan to buy US organic grocer Whole Foods for £10.7bn.

retail shares tumbled on both sides of the Atlantic as traders worried that the company – with all its financial might – was about to wade into the food sector.

Traders are braced for further swings when markets reopen this morning.

It follows a vicious price war on the ultra-competitiv­e British High Street, with several household names seeking safety through big deals.

Sainsbury’s bought Argos for £1.4bn last year and is now reportedly hoping to bulk up further with the Nisa bid. The supermarke­t is said to be close to agreeing a deal with the business, which has 2,900 stores and is owned by its members.

Sources said the takeover had been in the works since long before Amazon’s raid on Friday.

It is claimed that Sainsbury’s has offered £2,500 a share for Nisa, meaning the mutual’s shopkeeper­s are in line for up to £625,000 each.

But members have resisted takeover attempts in the past and there is likely to be a major rebellion – with some already calling for Nisa’s chief executive Nick read to resign.

others have also decided there is strength in scale. Tesco, for example, is buying wholesale goods seller Booker for £3.7bn in a bid to broaden its horizons.

Meanwhile, Morrisons has an existing deal with Amazon – pushing its shares up on Friday when others fell, and inevitably leading to speculatio­n it too might be a takeover target.

Another stock to gain ground after the Whole Foods announceme­nt was online grocer ocado, which is also likely to be in the frame if Amazon pushes further into the industry.

The company has developed advanced warehouse robots seen by many insiders as a valuable tool for online food retailers.

ocado is facing a spat with activist investor Crystal Amber following concerns about its direction – in an intriguing parallel with Whole Foods, which had been locked in a bitter row with hedge fund Jana Partners.

Jana accused it of ‘chronic underperfo­rmance’ and in response, Whole Foods founder and chief executive John Mackey said the investor was a ‘greedy b******’.

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