Morrisons may be in the driving seat to take over Safeway but some analysts believe Wal-Mart may still have the last word.
Wal-Mart has a track record of counterbids when it bought Asda under the nose of Kingfisher in 1999, which an analyst added was "20 times its earnings while Morrisons has bought Safeway at only 11 times its earnings".
Wal-Mart would make synergy savings and the Asda fascia and ranges would increase sales, analysts said, but Safeway stores are much smaller than the average Asda, which would make it difficult for Asda to fit in its non-food offering and make the stores "Asda-esque".
But one analyst said Wal-Mart had nothing to lose in making a counterbid while Morrisons had everything to lose. He added that Wal-Mart's president and CEO Lee Scott is a known admirer of Morrisons but asked: "Why would he let a major price competitor enter the market at a larger scale?"
However the biggest hurdle for Wal-Mart would be the competition authorities.
Andrew Fowler, retail analyst at Merrill Lynch, said he saw only two scenarios where an Asda takeover of Safeway would be passed. The first was a "mercy killing" where Safeway was in such a bad position it had to close stores and make redundancies. But he believed this was a "million miles away".
The second would be if Tesco started abusing its power as market leader, meaning a takeover of Safeway became a necessary social counter-balance.

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