Sainsbury's awards print assignment to publisher New Crane

Sainsbury's has awarded New Crane, the publisher of its customer magazine, a slice of its print advertising business.

New Crane, which publishes Sainsbury's The Magazine, has taken on the supermarket chain's quality press advertising, which promotes the quality of its products compared with those of rivals such as Asda and Tesco. The business was previously held by Abbott Mead Vickers BBDO.

Sainsbury's played down the significance of the win, saying that it was only a small piece of business. However, the decision to hand the brief to New Crane fuels speculation that the supermarket's relationship with its agency is under strain.

The relationship between Sainsbury's and AMV has been under the spotlight in recent months amid concerns that its ads starring Jamie Oliver are becoming tired. Oliver signed a new two-year contract in May.

The retailer is under intense pressure to improve its financial performance.

Its full-year pre-tax profits dropped 8.5 per cent to £160 million in 2003, contributing to the ousting of its chairman, Sir Peter Davies. Davies was a keen supporter of AMV.

Sainsbury's financial performance and the fact it is being dwarfed by its rivals Tesco and Asda is attracting potential bidders. The retail tycoon Philip Green and the US retail giant Target have been linked to potential bids.

Last Thursday, Sainsbury's share price rose 13p to 271p amid takeover speculation.

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