LONDON: File photo shows a man walking past a Morrisons supermarket in Stratford, east London. Britain's fourth biggest supermarket said it had accepted a £6.3-billion ($8.7-billion, 7.3-billion-euro) takeover offer from a consortium of investment groups. — AFP

LONDON: The UK supermarket sector, which has benefitted hugely from a shift to online shopping during the pandemic, is set for a further shakeup with Morrisons heading for a multi-billion-pound takeover. Britain's fourth biggest supermarket on Saturday said it had accepted a £6.3-billion ($8.7-billion, 7.3-billion-euro) takeover offer from a consortium of investment groups. And yesterday, US private equity firm Apollo Global Management revealed it was mulling a rival bid.

It comes after Morrisons last month rejected a £5.5-billion offer from US private equity firm Clayton, Dubilier & Rice. The British supermarket "is seen as a bargain compared to overseas peers, with its deep integrated supply chain and the fact that it owns much of its store estate", noted Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

"The company is already a prince in Amazon's e-commerce empire." Reflecting the fresh interest in the group and a potential bidding war, Morrisons' share price jumped 11 percent in London morning deals. Apollo yesterday said it was "in the preliminary stages of evaluating a possible offer for Morrisons" on behalf of investment funds. It comes after a consortium comprising Softbank-owned Fortress, Canada Pension Plan Investment Board and Koch Real Estate Investments, had their takeover bid accepted.

Morrisons is Britain's fourth biggest supermarket chain in terms of sales, according to data group Kantar. Trailing leader Tesco, Sainsbury's and Asda, it nevertheless has almost 500 stores and more than 110,000 employees in the UK. At the end of last year, US retail giant Walmart agreed to sell Asda to the billionaire Issa brothers and a private equity group for £6.8 billion. While UK supermarkets have enjoyed strong sales during the pandemic, they have faced hefty added costs with having to employ thousands of extra staff to meet rising demand for online food shopping. - AFP