Costcutter owner snaps up £193m share of Sainsbury’s

One of Britain’s biggest family-owned businesses has snapped up a £193m stake in Sainsbury’s.

Bestway, which owns Costcutter and Bargain Booze, said it had acquired a 3.45pc holding, equivalent to around 80.7m shares, in the supermarket, which is the UK’s second biggest. 

Based on Sainsbury’s share price at close on Thursday of 239.4p, the acquisition would be valued at around £193.4m.

Bestway said it had no plans to make an offer for the grocer but said it may look to purchase more shares at a later date. 

Shares in Sainsbury’s jumped as much as 6.5pc following the announcement. 

Sainsbury’s confirmed in a statement: “We will engage with Bestway Group in line with our normal interactions with shareholders.”

However, Bestway has the right to make an offer with the agreement of Sainsbury’s or if another business puts a deal on the table, it said.

Takeover speculation has swirled around Sainsbury’s for some time as Britain’s supermarket industry becomes increasingly consolidated. Last year US private equity firm Clayton, Dubilier & Rice completed the highly leveraged takeover of Wm Morrison Supermarkets Plc. 

Bestway is a multinational business that operates the UK’s biggest independent wholesaler, Bestway Group, and also has a controlling stake in Pakistan’s third largest bank, United Bank Limited. It is the UK’s seventh largest family-owned business with an annual turnover of £4.5bn.

The company is owned by the Pervez, Choudrey and Sheikh families, and acquired pharmacy group Well Pharmacy from The Co-operative Group in 2014.

It bought Costcutter from Bibby Line in 2020, which had bought the convenience store chain from its founder Colin Graves in 2012.

Qatar Investment Authority is currently a major shareholder in Sainsbury’s with more than a 14pc share of the supermarket, with Czech billionaire Daniel Kretinsky’s Vesa Equity Investment holding a 10pc stake. 

Earlier this month, Sainsbury’s revealed it saw record sales over Christmas as shoppers treated themselves at home over the festive period and during the FIFA World Cup.

It means the UK’s second-largest supermarket chain could see its full-year profits hit the top end of previous guidance following the better-than-expected sales figures.