Sainsbury's-Asda merger blocked by competition watchdog


Thursday, April 25, 2019

A proposed merger between Sainsbury's and Asda has been blocked by the UK's competition watchdog over fears it would result in higher prices for consumers.

The Competition and Markets Authority (CMA) found that the £12 billion merger would lead to increased prices in store, online and at petrol stations across the country.

In its final report into the deal, the CMA said shoppers and motorists would be "worse off" if Sainsbury's and the Walmart-owned Asda were to merge.

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."

Prior to today's decision, Sainsbury's and 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.

Responding to the merger block, Sainsbury's boss Mike Coupe, said: "The CMA's conclusion that we would increase prices post-merger ignores the dynamic and highly competitive nature of the UK grocery market.

"The CMA is today effectively taking £1 billion out of customers' pockets."

Roger Burnley, the Asda boss, added that he is "disappointed" in the CMA's decision.

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