KKR Planning Asda Bid as Sainsbury's Deal Faces Hurdle: Times

(Bloomberg) -- KKR & Co. is planning a bid for Walmart Inc.’s Asda as the U.K. supermarket chain’s $9.5 billion takeover by rival J Sainsbury Plc edges close to collapse, the Sunday Times reports.

The U.S. buyout firm is thought to be working with Tony De Nunzio, a former Asda chief executive officer and now a senior adviser to KKR, according to the Sunday Times, which didn’t disclose its source for the information. He would become chairman of the supermarket chain if KKR struck a deal, it said.

Sainsbury’s attempt to create the biggest U.K. supermarket chain with its 7.3 billion-pound purchase of Asda faced a major setback on Wednesday after antitrust authorities attached harsher-than-expected conditions for approval. The report drove Sainsbury shares down the most in more than a decade, and weighed on shares throughout the industry.

The Competition and Markets Authority said the companies might have to sell off one of their two well-known corporate brands to win approval. The companies are unwilling to make such a move, people familiar with the matter told Bloomberg, leading to speculation that Walmart may seek a buyer elsewhere and that private-equity firms may start circling Asda.

Any private-equity deal would need to be structured to allow Walmart a “significant minority holding” to limit the purchase price while allowing it to retain Walmart’s buying power, the Sunday Times said, citing unidentified people.

Walmart was not in a rush to find another buyer for Asda, the report said, citing an unidentified person close to the U.S. company, with executives still reviewing the regulator’s findings.

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