Sainsbury’s held secret, high-level takeover talks to acquire rival supermarket chain Morrisons in a multibillion-pound deal that would have fundamentally reshaped the UK grocery market, according to the Financial Times.
The negotiations, spearheaded by Sainsbury’s chief executive Simon Roberts and Morrisons chair Sir Terry Leahy, ran from November 2025 until collapsing in February 2026 after the parties failed to reach an agreement on price. The proposed transaction aimed to provide a buyout exit for private equity firm Clayton Dubilier & Rice (CD&R), which acquired the Bradford-based grocer for £10bn in 2021.
A combination would have brought together two of the UK’s largest grocers, significantly boosting buying power with suppliers and integrating Morrisons’ extensive fresh food manufacturing capabilities into Sainsbury’s business. To prepare the ambitious transaction, Sainsbury’s instructed financial advisers at Robey Warshaw alongside antitrust legal teams to assess potential store divestments required to satisfy regulatory scrutiny.
Despite the UK Competition and Markets Authority (CMA) blocking Sainsbury’s proposed £7.3bn merger with Asda in 2019, advisers on both sides expressed confidence that a Morrisons deal could navigate antitrust hurdles. Negotiators believed the UK grocery landscape had shifted dramatically due to the rapid growth of German discounters Aldi and Lidl, which now hold a combined 19.3% market share. Furthermore, acquiring Morrisons—which has dropped to sixth place in market share behind the discounters—would not have created an overwhelming market leader, unlike the previously attempted Asda combination.
Although talks are currently inactive, the disclosures signal a renewed appetite for consolidation among top UK grocery executives. With private-equity-owned grocers like Morrisons and Asda facing elevated debt-servicing costs, industry analysts suggest the initial discussions between Sainsbury’s and Morrisons could trigger wider strategic restructuring across the sector.