LONDON-The race to snap up the 1,300-store Somerfield chain lost some of its impetus after London & Regional announced it was pulling out of the bidding. L&R owners Ian and Richard Livingstone have decided not to proceed with an offer for Somerfield. No further details of the decision were forthcoming. The firm had been working with Japanese bank Nomura on its potential offer, which, as GlobeSt.com has reported, faced competition from a consortium featuring property tycoon Robert Tchenguiz, private equity group Apax Partners and Barclays Capital.
With the battle set to become a one-horse race, the supermarket chain's shares slumped by almost 5% today. The involvement of London & Regional emerged in April after the Bristol-based company earlier rejected an offer from retail investment group Baugur.
The frustration of the Somerfield board at the length of the process was aired in September when it demanded a "prompt conclusion" to the talks. That was followed by a ruling from the Takeover Panel that said both parties had until Oct. 14 to either "put up or shut up."
Privately analysts expressed their believe that L&R pulled out of the race because retailer United Co-operatives was no longer interested in taking on 500 of the Somerfield outlets as part of the deal. United, which is the country's largest regional co-operative group, had considered launching its own bid for Somerfield earlier this year.
Somerfield, which is the UK's fifth largest supermarket group, has around 1,300 shops in the UK, including a large number under the KwikSave brand. L&R said it had retained the right to make an offer in the event of a rival bid.
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