UK-based supermarket giant Sainsbury’s has revealed that it has ended talks over selling its banking business.
Sainsbury’s, which is a key grocer in the British market, stated that the potential bids from buyers did not offer good value for shareholders.
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Sainsbury’s said: “Whilst the Board of Sainsbury’s believe that it was in the best interests of shareholders to explore these expressions of interest, it has concluded that these do not offer better value for shareholders than will be realised through retaining Sainsbury’s Bank.
“We continue to make progress strengthening and simplifying our Financial Services business in line with our strategy and we remain comfortable with consensus profit forecasts for the division.”
In November 2020, Sainsbury’s started exploring options to sell its banking arm to simplify its business operations and reduce cost.
Launched in 1997, Sainsbury’s Bank was a joint venture between Sainsbury’s and Lloyds Banking Group (LBG).
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By GlobalDataIn 2013, the grocer acquired a 50% stake and took full control of the bank by paying £260m to LBG.
It has customers across mortgage, home insurance, and credit cards, among others.
In 2019, Sainsbury’s Bank withdrew from the mortgage market due to intense competition.
As per Reuters’ report, British lenders including Lloyds Banking Group, Barclays, and NatWest were among the potential buyers.
Earlier, Sky News reported that US private equity group Centerbridge Partners was nearing an agreement to acquire Sainsbury’s Bank for £200m.
