International buyers are being drawn to British supermarkets because they are massively undervalued, according to ex-Sainsbury’s chief executive Justin King.
His comments came after a series of private equity bids for Big 4 grocers.
“People have assessed, partly through the purchase of Asda by the Issas, that supermarkets in the UK are the most undervalued in the world,” King told The Telegraph.
The billionaire Issa brothers bought Asda for £6.8 billion last year, while Morrisons has agreed a £6.3 billion sale to an investment consortium led by buyout firm Fortress.
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King, who sits on the board of e-commerce platform Snappy Shopper, argued that the Covid-19 had revealed how “adaptable” supermarkets were to customer habits.
“Everyone said all these businesses are managing long-term decline,” he said.
“Actually, they are more than future-proof with people coming towards them.”
Supermarkets have been one of the big winners of the pandemic, seeing record sales and rapidly shifting towards internet shopping.
Some feel Sainsbury’s could be the next target of a private equity bid, after Czech billionaire Daniel Křetínský acquired a 10 per cent stake in April.
However, Sainsbury’s chairman Martin Scicluna dampened speculation last week at the company’s annual meeting.
While he admitted following the Morrisons takeover, he claimed that executives were “clearly happy” with the strategy of current chief executive Simon Roberts.
