The creditworthiness of two of the four supermarket companies bidding for UK rival Safeway could be adversely affected by the deal outcome, according to Standard & Poor's (S&P), the rating agency.

Omar Saeed, a credit analyst at S&P, said the credit ratings of UK groups J Sainsbury, rated A-/Negative/A-1, and Tesco, rated A+/Negative/A-1, could both suffer if they fail in their bids to acquire the whole of Safeway. A downgrade could then make the cost of borrowing more expensive, exacerbating problems as pricing competition between retailers intensifies.