Safeway is the fourth largest supermarket chain having 479 stores. By acquiring Morrison, it becomes the fourth largest supermarket in the UK food retailer with combined sales of pound 13 billion and 552 sectors. The merging helps a substantial cost saving of around pound 215 million a year. The acquisition helps not only the stakeholders but also the customer, employees; supplier. Because after acquiring the company becomes the fourth largest supermarket. After acquisition the Safeway’s product cost is reduced, this benefits the customer very much. Moreover, merging with Safeway allows accelerating the rollout of successful and popular retailers across the UK thus provides the consumer with distinctive offers and benefits to the shareholders.
Safeway’s shareholders are very conscious of the possibility that a higher price can be negotiated. The price is right for Safeway’s shareholders, a takeover by Morrison is certainly important to generate revenue per store than its larger rival.
Moreover, the company is expected to combined sales of over pound 12.6 billion and a market share of 16.1 per cent. The current trading is very strong, the total sales goes an increasing trend, i.e., 14.2 per cent.