Retail giant to invest £50m to cut prices

Sainsbury’s has said it will invest £50 million into the price of its products in a move which will make dozens of popular items cheaper for shoppers.

The supermarket chain said the move will see 60 core fresh produce, meat and dairy products cut in price by the end of the month.

It is the latest step in the retailer’s plan to “put food back at the heart of the business” and focus on improving value amid continued competition for customers from German discount rivals Aldi and Lidl.

It also comes after Sainsbury’s launched its Aldi Price Match scheme earlier this year to reduce the price of hundreds of items.

Sainsbury’s said the latest round of price cuts will land this week, covering everyday essentials including chicken, bacon, herbs and potatoes.

Around 43 items will be reduced on July 7, with a raft of further reductions taking the total to 60 by the end of the month.

Rhian Bartlett, Sainsbury’s food commercial director, said: “Now more than ever, we know we need to do more to deliver the great quality customers expect from Sainsbury’s, at great prices. It’s our mission to help everyone eat better and these price reductions are the latest step to show how serious we are about delivering on this promise to customers.”

Sainsbury’s has seen strong sales over the past year as it remained open during coronavirus lockdowns.

Sales for the 12 months to March jumped 7.8%, although the business dropped to a £261 million loss for the year after it was impacted by £485m in Covid-related costs.

Morrisons supermarket has agreed to a £6.3 billion takeover bid from a consortium of investment groups.

The offer, led by Softbank-owned Fortress which has partnered with Canada Pension Plan Investment Board and Koch Real Estate Investments, will see shareholders receive 252p per share plus a 2p special dividend.

The all cash offer is subject to shareholder approval.

It represents a 42% premium on the Morrisons share price before it was announced the supermarket had rejected a takeover proposal from New Yorkbased firm Clayton, Dubilier & Rice last month. Fortress has invested in grocery retail in North America and Europe and invested in Majestic Wine in the UK.

In the US, Fortress has invested in the grocery industry, retail and restaurants.

Andrew Higginson, chairman of Morrisons which has 110,000 employees, said: “The Morrisons directors believe that the offer represents a fair and recommendable price for shareholders which recognises Morrisons’ future prospects.”

Seema Malhotra, Labour’s shadow minister for business and consumers, said: “Any takeover bid must be closely scrutinised by the government.”

The offer equals a 42% premium on the share price.