Stock of Sainsbury’s surged in anticipation of interest from Morrisons’ loser

Shares of British supermarket group Sainsbury’s jumped as much as 3.7 percent on Monday on speculation that SoftBank’s Fortress Investment, lost the bidding for Morrisons, may shift its focus to a larger player in UK grocery. At 0858 GMT, Sainsbury’s shares were up 4.2 pence to 288.9 pence, valuing the company at 6.7 billion pounds ($9.1 billion).

In the duel for Morrisons, Britain’s No. 4 grocery chain, Fortress was lost, asking 286 pence per share – a penny less than rival Clayton, Dubilier & Rice. Managing partner Joshua, A Pack, on the other hand, indicated that Fortress was still interested in UK assets. “The UK remains a very attractive investment environment from many perspectives, and we will continue to explore opportunities to help strong management teams grow their businesses and create long-term value,” he said in a statement.

Sainsbury’s trails only market leader Tesco (OTC: TSCDY) in UK grocery sales, according to a Fortress representative. A spokesman for Sainsbury’s also declined to comment. Sainsbury’s stock has risen 28 percent this year as a result of bid rumours. This began in April, when Czech billionaire Daniel Kretinsky increased his position in Sainsbury’s to just under 10%, and has been fueled by the Morrisons bid war and hints that CEO Simon Roberts’ “food first” approach is beginning to bear fruit.