M&S drops US business sale

Kings buyers hit fundraising hurdle
August 14 2003
Marks and Spencer has pulled out of talks to sell its US business Kings Super Markets.

M&S confirmed last month that it was back in talks with New York based supermarket operator Gristede’s, which was offering $120m cash for the 26-store Kings business. However, Gristede’s has once again found it hard to raise the necessary funds in the underperforming US retail market.
Marks & Spencer chief executive Roger Holmes said: “In the current US climate it has not been possible for interested parties to raise sufficient funds to purchase Kings at what we perceive to be a fair price.
“Although Kings is not central to our strategy, we believe that maximising shareholder value will be achieved by working with the senior management team to develop the business and drive financial performance.”
Previous negotiations with Gristede’s ended last year, also due to the US operator’s problems raising funds. Rival New York operator D’Agostino Supermarkets had to pull out of talks for similar reasons.