Rumours of new Qatari move for Sainsbury

Shares in J Sainsbury rose almost 20 per cent during trading on Thursday on speculation that the UK’s third-largest supermarket chain was once again in the sights of the Qatar Investment Authority.

The shares closed up 31.4p, or 10 per cent, at 342.5p, after some 71m shares changed hands.

The rise was driven by speculation that the Qataris were plotting another bid at about 425p a share – valuing Sainsbury at £7.9bn – working with Roger Jenkins, the former Barclays executive.

The QIA declined to comment, but people familiar with the situation said Mr Jenkins was not involved. Sainsbury also declined to comment.

Analysts noted that after a share price movement of such a magnitude, Sainsbury would have been required by the Takeover Panel to make a statement if it had been the subject of an approach.

The Sainsbury family is not thought to have received any overtures.

Some analysts were also sceptical about the likelihood of a bid because the QIA did not take up its entitlements when Sainsbury raised more than £400m from investors for expansion plans earlier this year.

But the surge in the shares put the future of the QIA stake of 26 per cent firmly back on the agenda.

Sainsbury was mindful of the possibility of another bid approach when it conducted the search for a chairman earlier this year.

It was keen to secure a chairman with City experience in case it found itself once more in the sights of a predator.

Last month, it appointed David Tyler, who spent some time in investment banking. He is also a former finance director of GUS, where he was heavily involved in the store group’s corporate activity.

The uncertainty comes at a delicate time for Sainsbury. Sales growth is slowing and Justin King, chief executive, is seen as a candidate to succeed Sir Stuart Rose as chief executive of Marks and Spencer.

Mr King, unlike other possible external candidates such as Asda’s Andy Bond, has repeatedly refused to rule himself out.

Sainsbury was the subject of a takeover approach by the QIA, working with Paul Taylor, its UK investment adviser, two years ago.

The Delta Two Consortium made a 600p indicative offer, valuing Sainsbury at £10.6bn. However, the consortium walked away and the relationship between the QIA and Mr Taylor has since broken down.