Woolworths is preparing to submit a final bid for Li Ka-Shing’s ParknShop, the second largest grocery chain in Hong Kong.
The supermarket chain is said to be willing to pay 15 to 16 times earnings before interest, tax, depreciation and amortisation, which would equate to a sale price of about US$3 billion, reports The Australian Financial Review.
Woolworths CEO, Grant O’Brien, has repeatedly refused to confirm or deny that Woolworths is interested in ParknShop, which was put up for sale by Hutchinson Whampoa earlier this year. Other prospective bidders reportedly include Japanese department store operator, Aeon; and Chinese supermarket chain, China Resources Enterprise. If Woolworths does outbid the other players it would be its biggest acquisition to date.
ParknShop has 345 stores in Hong Kong, mainland China and Macau. It is Hong Kong’s second largest supermarket operator with about $US2.8 billion in sales.
