Sainsbury’s is to complete a share placing to help fund an accelerated growth strategy, following another strong trading quarter for its non-food offer.
Like-for-like sales excluding fuel and VAT were up 7.8% across the group for the 12 weeks to June 13 2009. The supermarket giant now intends to increase space by 15% or 2.5 million sq ft, by March 2011. To fund this growth, the group is looking to raise £445 million through the placing of new shares worth £225 million and an offering of convertible bonds worth £190 million.
Sainsbury’s said it intended to drive additional non-food ranges via its store extensions. The grocer’s non-food offer continued to deliver good growth and strong like-for-like sales supported by additional space this quarter.
Chief executive Justin King said: “The fund raising announced today will provide us with the financial flexibility to take advantage of the current opportunities to grow our business further and faster. We can speed up our growth in areas of lower market share, maintain the strength of our balance sheet and invest in the long-term growth of the business.”