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Britain's number three supermarket group, like leader Tesco Plc () which reported last week, said this year's wettest summer on record compared badly with last year when a heatwave and the World Cup fuelled entertaining and shopper spending.

Sales at Sainsbury's stores open at least a year rose 3.1 percent excluding fuel in the 16 weeks to October 6, the group said on Wednesday, slowing from 5.1 percent in the first quarter and an all-time high of 6.6 percent in the second quarter last year.

But it still outstripped recent figures from rivals including Tesco and WM Morrison Supermarkets ().

Wednesday's second quarter figures failed to affect Sainsbury's share price, with the market's focus set on Qatari group Delta Two's proposed bid and the shares already changing hands at 579 pence per share, close to the 600p offer price.

It is trading at 31 times forecast full-year earnings, according to Reuters data, nearly double the European retail industry average .SXRP of 18.8 times.

"Clearly the bigger issue is the bid situation, which now seems to be all but complete. The pension funding appears to be the major stumbling block, but, as in the Alliance Boots deal, we expect this to be overcome eventually," Seymour Pierce analyst Andrew Wade said, referring to the recent takeover of the British drugstore chain.

In what could be Sainsbury's last quarterly trading update as a listed company, total sales excluding fuel rose 4.7 percent, broadly in line with analyst expectations.

FORMAL BID IMMINENT?

Sainsbury Chief Executive Justin King declined to comment on the bid and insisted morale was unaffected. "There is still a spring in the step around the place", he said.

The company was looking forward to Christmas and the rest of the trading year "with some confidence", although there were signs household budgets were being squeezed, he said.

"We've found (people) don't skimp on what they put on the Christmas table and we expect that to be the same this year," King told reporters in a conference call.

Sainsbury also remains ahead of its three year target to increase sales by 2.5 billion pounds, although analysts in the main consider this to be relatively easy to reach given it includes store acquisitions and taxes.

The retailer is in the third week of "due diligence" by Delta Two prior to any bid and several analysts have said they expect a formal offer could be launched as early as this week, in the face of sabre-rattling by the Sainsbury family.

"We expect news of a formal bid imminently which would provide a read-through for the rest of the sector. We expect that Sainsbury would be left vulnerable if the new owners pursue a cash-focused strategy," Citigroup analyst David McCarthy said.

The supermarket's founding family, who hold an 18 percent stake in the group, are planning to try to block Delta Two's bid if it fails to strike a deal with the pension trustees who want around 2 billion pounds, sources familiar with the matter said on Tuesday.

The family torpedoed a bid by a private equity consortium in April but are considered to hold less sway this time around because the Qataris behind Delta Two already own 25 percent of Sainsbury's shares, making them its leading shareholder.