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Gloucestershire Business News

Supermarket merger in trouble

A proposed merger between two of the big four supermarkets looks to be in trouble.

The Competition & Markets Authority (CMA) investigation into a merger between Sainsbury's and Asda has found concerns in a number of areas, specifically grocery shopping in supermarkets, grocery shopping online and petrol stations, as reported by the BBC.

If the findings are confirmed, the CMA would have two options - prohibition of the merger or sale of stores and assets.

The chief executive of Sainsbury's has said that the merger between Booker and Tesco was cleared by the competition authorities without any stores being sold off. But the CMA said this shouldn't set a precedent as it was deal between a supermarket and a wholesaler, rather than a merger of two of the UK's biggest retailers.

Sainsbury's also said that it believed a merger would allow it to lower prices, while the CMA believes it will push up prices of both fuel and groceries and give less choice and worse quality for shoppers.

The CMA said the information published today is its provisional findings and not a decision. It will now take its findings for consultation and will make a decision based on responses to the consultation.

Following the news that the merger could be under threat, Sainsbury's shares fell by 14 per cent.

What do you think? Would a merger be good for customers? Email mark@moosemarketingandpr.co.uk  

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