Sainsbury's to buy nine more Safeway stores
UK supermarket chain, Sainsbury's, is to buy a further nine Safeway branded stores from Morrisons; eight in the South of England and one in Scotland.
The gross asset value of the stores in January 2005 was approximately £16.8m (US$30.2m). It is anticipated that the acquisition of these stores will be earnings enhancing in their first full year of operation.
Each store acquisition is conditional upon approval from the UK Office of Fair Trading. The acquisition is expected to be completed in three tranches in the autumn of 2005. The stores will then be closed for six weeks while they are refurbished and reopen under the Sainsbury's fascia ahead of Christmas.
Last year, Sainsbury's acquired 14 stores from Morrisons (13 Safeway branded stores and one Morrisons store) located primarily in the Midlands and the north of England. All these stores are now open and trading well.
According to Justin King, Sainsbury's chief executive, "These stores give us over 175,000 sq ft of new space, and have an average size of around 20,000 sq ft. They will provide an opportunity to strengthen our market position in town centre locations and deliver future growth. We look forward to welcoming 100,000 new customers and 1,220 new colleagues to Sainsbury's."
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