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Sainsbury’s and Asda mega merger in doubt

The Competition and Markets Authority could block the proposed merger of Sainsbury’s and Asda after it found ‘very significant competition concerns in a number of areas’. The merger would see the combined forces of housewares from Sainsburys, Asda, Argos and Habitat.

The CMA could also force the sale of a large number of stores or even one of the brand names, according to BBC News, stating that customers could see higher prices and less choice as a result of the proposed deal.

However, a spokesperson for Sainsbury’s and Asda said that the provisional findings “fundamentally misunderstood how people shop in the UK today and the intensity of competition in the grocery market”.

Above: Some of Sainsbury’s current range of kitchenware.
Above: Some of Sainsbury’s current range of kitchenware.

The statement continued: “The CMA has moved the goalposts and its analysis is inconsistent with comparable cases. Combining Sainsbury’s and Asda would create significant cost savings, which would allow us to lower prices.

“Despite the savings being independently reviewed by two separate industry specialists, the CMA has chosen to discount them as benefits.”

 

Top: A vision of the merged Sainsbury’s and Asda businesses.

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