Delta Two's £10.6bn bid for Sainsbury's is still not a done deal, despite the board opening up the books to the Qatari-backed fund, analysts have warned.

After two months of what Sainsbury's described as "extensive" behind-the-scenes negotiations, the retailer's board has given Delta Two permission to carry out due diligence.

Delta increased the equity portion of its offer by £250m to £4.85bn, which means the level of debt in the deal would be reduced from the £6bn proposed in July to £5.75bn. There will also be £3.85bn for long-term investment and to repay Sainsbury's existing debt.

The question was whether the increase in equity and capital expenditure commitment would satisfy the Competition Commission given fears a debt-heavy Sainsbury's would not be competitive, said Seymour Pierce analyst Richard Ratner.

"There is also the question of the pension trustees and the Sainsbury family. As such, there can, at present, be no guarantee that it will come to fruition. The situation is too close to call."

Another analyst said Delta Two could still walk away if the family and trustees put on too much pressure on it to change the terms of the deal again.

"This is not a done deal as they have still to get over the hurdle of the family and the pension trustees - and the commission, which really should look at this," he said.

"Morrisons this week suggested the market was going to get tougher, which means the Qataris could walk away now and come back next year and get a better price."