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Sept. 26, 2022, 2:51 a.m. EDT

Sainsbury’s talks with LXI REIT over sale of 18 stores collapse due to market volatility concerns

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By Joe Hoppe

J Sainsbury PLC said Monday that it is no longer in discussions with LXI REIT PLC over the sale and leaseback of a portfolio of 18 supermarket stores, due to LXI’s market volatility concerns.

The British grocer /zigman2/quotes/206038250/delayed UK:SBRY -0.22% said the investment trust isn’t proceeding with a share issue that would have partly funded the transaction due to stock market volatility concerns, and the two parties are no longer in discussions.

LXI /zigman2/quotes/203623278/delayed UK:LXI +0.68% separately said the decision follows detailed and supportive discussions with its shareholders. Sainsbury’s said the decision wouldn’t affect its financial guidance.

The two companies had said on Wednesday that they were in discussions for LXI to buy and lease back 18 assets for an expected 500 million pounds ($542.5 million).

Sainsbury’s said then that if the transaction was carried out, proceeds would have been used to part-fund the purchase of 21 freehold Sainsbury’s supermarkets from other property portfolios.

The company now says the purchase will complete in the first half of its fiscal year ending March 2024, and given its balance-sheet strength and property portfolio, it has many alternative financing options for the purchase.

Write to Joe Hoppe at joseph.hoppe@wsj.com

/zigman2/quotes/206038250/delayed
UK : U.K.: London
225.90 p
-0.50 -0.22%
Volume: 6.79M
Dec. 7, 2022 4:35p
P/E Ratio
9.27
Dividend Yield
6.11%
Market Cap
£5.27 billion
Rev. per Employee
N/A
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/zigman2/quotes/203623278/delayed
UK : U.K.: London
118.20 p
+0.80 +0.68%
Volume: 3.44M
Dec. 7, 2022 4:35p
P/E Ratio
12.74
Dividend Yield
5.33%
Market Cap
£2.01 billion
Rev. per Employee
N/A
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