It had agreed a $160m deal for the 29-strong chain with D’Agostino in July, after looking for a buyer for more than a year, but terminated the contract when the November 30 completion deadline expired.
Gristede’s had a three-week exclusivity deal in June. It collapsed because it could not raise the required finance after the Worldcom scandal.
An M&S spokesman said: “We are talking to Gristede’s and are happy to continue talks with D’Agostino on a non-exclusive basis. We remain committed to selling Kings.”
M&S added it was also in talks with other parties. New Jersey food wholesaler Di Giorgio is said to be one of the potential buyers, possibly making a joint bid with Gristede’s.