CMA launches inquiry into Sainsbury’s-Asda merger

The Competition & Markets Authority has begun a formal investigation into the merger of Sainsbury’s and Asda. At the end of April, the supermarket giants announced proposals for a landmark £12bn merger.  The CMA has now started the first phase of a “detailed assessment” that will scrutinise how the deal could affect competition for UK customers. The enquiry will consider whether the deal could lead to less choice, and therefore higher prices, or worse-quality services across in-store and online product ranges sold by both businesses. These include fuel, electricals, toys and clothing. The watchdog will also look at whether the merged company could use its increased buying power to squeeze suppliers and whether this could have potential knock-on effects for shoppers. Both supermarkets have asked the CMA to use a “fast-track” process for the first phase of the inquiry. The CMA is inviting views by 31 August on how the merger could affect competition. Further opportunities to submit views will also be provided during its Phase 2 investigation. Andrea Coscelli, chief executive of the CMA, said: “About £190bn is spent each year on food and groceries in the UK, so it’s vital to find out if the millions of people who shop in supermarkets could lose out as a result of this deal. “We will carry out a thorough investigation to find out if this merger could lead to higher prices or a worse quality of service for shoppers and will not allow it to go ahead unless any concerns we find are fully dealt with.” In June, MPs criticised the merger at a select committee assessing the impact of the combined business on consumers and suppliers. Read a full analysis of the supermarkets’ portfolios and what the deal could mean for landlords. To send feedback, e-mail pui-guan.man@egi.co.uk or tweet @PuiGuanM or @estatesgazette