The biggest shareholder in Sainsbury's, the Qatar Investment Authority (QIA), is selling £306 million (€365 million) worth of shares in the British supermarket group, according to regulatory filings.
Shares in Sainsbury's were down nearly 5% in early trading Friday.
The filings show QIA offered 109.4 million shares at a price of 280 pence (334 cents), about 5% of its holding.
Market Share
Prior to the offer, QIA had a 14.2% stake in Sainsbury's, according to LSEG data.
Sainsbury's stock closed Thursday at 288 pence (243 cents), up 12% over the last year.
The group has an over 15% share of Britain's grocery market, trailing only Tesco, with monthly industry data showing it performing well.
Sovereign Wealth Fund
Qatar's sovereign wealth fund has been a Sainsbury's shareholder since 2007.
That year its holding peaked at 25% and it abandoned a potential bid. It started selling in 2021.
"Given the strategic nature of the shareholder, we do not see it (the share disposal) being necessarily linked to upcoming events," said analysts at J P Morgan Cazenove, noting the UK's government's budget statement on October 30 and Sainsbury's interim results on November 7.
QIA's other high profile UK investments include a stake in Barclays Bank and London department store Harrods.
Consumer Confidence
Monthly industry data has shown its food business performing well. However, its non-food business, which makes up a quarter of its sales, has been affected by UK shoppers' reluctance to spend on discretionary items.
A spokesperson for Sainsbury's declined to comment on QIA's move, while QIA did not immediately respond to a request for comment.
Earlier this month, Sainsbury's boss, Simon Roberts, said Britons bruised by a cost of living crisis will not start spending strongly again until the new Labour government sets out its tax and spending plans, and interest rates fall further, the boss of supermarket Sainsbury's said yesterday.
Discretionary Markets
The chief executive told Reuters that despite falling inflation, higher wages, and solid employment levels, UK shoppers remain nervous about spending on bigger ticket items.
"Discretionary markets continue to be difficult," said Roberts, a more than 35-year veteran of the UK retail sector who has run Britain's second-biggest supermarket chain since 2020.
"Consumers inevitably are wanting to be clearer about what's going to happen next and for that reason we see a continued caution in discretionary spending," he said.
Additional reporting by ESM.
