Newspaper article The Journal (Newcastle, England)

Supermarket Merger off amid Competition Fears

Newspaper article The Journal (Newcastle, England)

Supermarket Merger off amid Competition Fears

Article excerpt

Byline: RAVENDER SEMBHY Business writer business@ncjmedia.co.uk @Jnlbusiness

THE competition watchdog has blocked the Sainsbury's group's PS12bn merger with Asda on the grounds that it would result in higher prices for consumers and damage competition.

In its final report into the deal, the Competition and Markets Authority (CMA) found that it would lead to increased prices in stores, online and at petrol stations across the UK.

Shoppers and motorists would be "worse off" if Sainsbury's and Walmart-owned Asda were to merge, the CMA said, adding that a tie-up would lead to price rises, reductions in the quality and range of products or a poorer overall retail experience.

The watchdog claimed that the deal would have resulted in a "substantial lessening of competition" at both a national and local level for people shopping in supermarkets.

Stuart McIntosh, chairman of the CMA inquiry group, said: "It's our responsibility to protect the millions of people who shop at Sainsbury's and Asda every week.

"Following our in-depth investigation, we have found this deal would lead to increased prices, reduced quality and choice of products or a poorer shopping experience for all of their UK shoppers.

"We have concluded that there is no effective way of addressing our concerns, other than to block the merger."

Sainsbury's boss Mike Coupe said that the decision effectively takes PS1bn out of customers' pockets.

Prior to Thursday's decision, Sainsbury's and Walmart-owned Asda had offered to sell up to 150 stores as part of efforts to address competition concerns, and claimed that shoppers would be deprived of lower prices should it be blocked.

But the CMA found 537 areas where there could be a substantial reduction in competition in supermarkets.

The duo had also pledged to make a number of post-merger commitments, had the deal been approved. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.