Sainsbury’s-Asda merger to face ‘in-depth’ probe
The £15bn tie-up between Sainsbury’s and Asda is to face an in-depth competition investigation.
The Competition and Markets Authority said the deal “raises sufficient concerns to be referred for a more in-depth review”.
In August the CMA started the first phase of a “detailed assessment” that scrutinised how the deal could affect competition for UK customers.
The £15bn tie-up between Sainsbury’s and Asda is to face an in-depth competition investigation.
The Competition and Markets Authority said the deal “raises sufficient concerns to be referred for a more in-depth review”.
In August the CMA started the first phase of a “detailed assessment” that scrutinised how the deal could affect competition for UK customers.
The enquiry considered 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.
However, it was not satisfied that prices could fall. The competition body said: “The companies are two of the largest grocery retailers in the UK and their stores overlap in hundreds of local areas, where shoppers could face higher prices or worse quality of service.”
It added that these concerns would be considered further in the phase-two investigation, along with other issues such as “those relating to fuel, general merchandise (such as clothing) and increased ‘buyer power’ over suppliers”.
In the coming weeks, the CMA will release a statement setting out in detail the issues it will investigate.
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.
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