Three possible bidders for Safeway are understood to have been approached by a go-between offering to sell them big stakes held by two US funds, according today's Daily Telegraph.
The report said the stakes, of around 12 per cent each, are those of US funds Fidelity and Alliance Capital Management, two of Safeway's largest shareholders.
Safeway has put itself up for sale and has attracted the interest of six bidders who are expected to offer over £3 billion for the business - if and when they eventually make a formal bid. Safeway's share price has risen by 50 per cent this month.
The potential bidders are rival supermarket groups Tesco, Sainsbury's, William Morrison, US-based Wal Mart's ASDA, retail entrepreneur Mr Philip Green, and US corporate buyout specialists Kohlberg Kravis Roberts (KKR).
The report said the stakes had been offered to ASDA, Green and KKR. All three are likely to bid cash for Safeway.