The takeover battle for Safeway was to blame for its dip in fourth quarter sales and the supermarket also revealed it had spent £17m in advisory fees on the five-way bid since January.
Safeway finance director Simon Laffin told The Independent that the fall in sales was due to the uncertainty of the group's future. He said suppliers were unwilling to give Safeway deals that might embarrass them depending on the group's eventual new owner. "Suppliers are nervous, particularly if Wal-Mart wins," Laffin said.

The Times said the supermarket has also spent £6m on staff retention bonuses during the bid process. Chairman David Webster said: “We are very committed to keeping the ship going.”
The £6m bonus pool has therefore been widely distributed among senior managers and some members of the executive board.
Safeway said it was difficult to maintain staff morale at its Hayes HQ, with 2,000 employees, most of whom are likely to lose their jobs, regardless of who wins the company.

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