(Feb. 3) One of the seven companies hoping to buy Safeway PLC, London, Britain’s fourth-largest supermarket chain, could be ready to bid. But a new valuation of the grocer’s worth might make its suitors think twice.

Phillip Green, a British billionaire retailer, met Jan. 27 with regulators in Britain’s Office of Fair Trading to get their blessing for his company’s pitch for Safeway PLC, which operates 480 stores in Great Britain. The bid is rumored to be an all-cash offer of about $5.2 billion. Reports said it would likely take several weeks for Green to round up the money for a bid.

Green and other hopefuls could be discouraged by a new report which values Safeway PLC much higher than its current stock value. On Jan. 24, DTZ, an independent valuer, put the company’s worth at $7.4 billion, more than $2 billion above Green’s anticipated bid. That translates into 391 pence per share, much higher than the 318-pence level Safeway PLC’s stock has been trading at for the past week. The company’s net book value is more than $3 billion under the new valuation, which is pegged to the chain’s real estate value.

Green’s would be the second bid for Safeway PLC. On Jan. 23, the company rejected an all-share bid from William Morrison Supermarkets PLC, Britain’s No. 5 chain. Safeway PLC is reported to want at least some cash from Morrison. Wal-Mart-owned Asda Group PLC, Britain’s No. 5 chain, is said to be considering an all-cash bid of more than $4.8 billion.

J. Sainsbury, the No. 2 chain, also might make a bid in excess of $4.8 billion, most likely combining cash and stock. But in another recent development, Moody’s Investors Service is reviewing Sainsbury for a possible downgrade. Moody’s says that if Sainsbury makes a bid for Safeway PLC, its credit could be significantly weakened.

The other potential bidders for Safeway PLC are London-based Tesco PLC, Britain’s No. 1 grocer; Kohlberg Kravis Roberts, a New York-based investment firm; and Texas Pacific Group, a U.S. private equity firm, the newest bidder.