Giant's stock climbs amid talk of chain's sale

July 18, 1995|By Alec Matthew Klein | Alec Matthew Klein,Sun Staff Writer

The illness of Giant Food Inc. Chairman and Chief Executive Israel Cohen has pumped up the company's stock as speculation grows that J. Sainsbury PLC will make a move to acquire a controlling interest in the supermarket chain Mr. Cohen's father co-founded.

Shares of Landover-based Giant rose $1.375, to $30.125 yesterday, after a report in The Observer, a London newspaper, that Sainsbury "is thought to be moving closer" to buying a majority interest.

Speculation has long held that Sainsbury, Britain's leading grocer and holder of a 16 percent stake in Giant, would try to buy a majority interest in the dominant supermarket in the region. Giant has 161 stores in Maryland, Virginia and Washington.

Talk intensified after Giant disclosed last week that Mr. Cohen, 82, has been diagnosed with myelodysplastic syndrome, a failure of the bone marrow to produce cells normally.

But some industry observers say that news of a company sale is premature and that yesterday's stock movement, though noticeable, could be interpreted as part of the company's steady upward climb for the past six weeks.

"That's a pretty significant jump [in Giant's stock price], but I think it's all fueled on unfounded speculation," said Jeff Metzger, publisher of Columbia-based Food World, a regional supermarket trade paper.

Sainsbury has not accelerated plans to acquire Giant, Mr. Metzger said, based on conversations he has held with individuals who attended Giant's most recent meeting of its board of directors. The board has seven members, three of whom are named by Sainsbury. Mr. Cohen chooses the other four.

Sainsbury officials could not be reached yesterday.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.