Qatari group raises its Sainsbury stake further

Three Delta, the Qatar-backed investment group, on Thursday confirmed it paid more than £1.4bn to become the largest shareholder in J Sainsbury, the UK’s third largest supermarket group.

The property investment group backed by the state of Qatar, bought more than 302m shares, which equates to 17.4 per cent of the share capital on Wednesday, catapaulting it to the top of Sainsbury’s shareholder register.

Shares in the company fell 1p to 567p, having risen 36½p, or 6.9 per cent, to 566½p on Wednesday. CVC offered as much as 580p a share before concluding that no deal would be reached.

Three Delta is headed by Sheikh Hamad bin Jassim bin Jabr al Thani, foreign minister of Qatar. The fund is managed by Paul Taylor, former business partner of Robert Tchenguiz, the property entrepreneur who owns more than 5 per cent of J Sainsbury, and has called on the board to gear up its balance sheet and return money to shareholders.

Mr Tchenguiz is not working with the Qataris, but he welcomed their presence on the shareholder register on Wednesday, suggesting it added weight to his calls for a radical overhaul of Sainsbury’s property portfolio.

“We’re delighted that they are a shareholder,” he said. “It shows that there are more real estate investors out there with real operating experience. Having worked with Paul Taylor in the past, we are very aware of his ability in the market.”

Mr Tchenguiz met Sir Philip Hampton, chairman of Sainsbury, and Justin King, its chief executive, this month to advocate splitting the operating company from its property estate. This could then be leveraged through a real estate investment trust, under his proposal.

Mr Tchenguiz has been seeing other shareholders this week to gauge their reaction to an ”opco-propco” structure. However, he is understood to have cancelled his meetings for the rest of the week after seeing the stakebuilding on Wednesday.

Mirabaud Securities carried out the trade but refused to confirm the identity of the buyer or the seller, saying: ”We were involved and are pleased to have helped put the deal together.”

The CVC-led bid for Sainsbury was stymied by opposition from members of the Sainsbury family, who hold a combined 17 per cent stake in the retailer.

However, Lord David Sainsbury, the leading family shareholder with 7.75 per cent, is understood not to object in principle to a more aggressive use of the property portfolio, but to believe the case needs to be proven.