Markets

Sainsbury's and Asda in £12bn merger

Sainsbury's and Asda in £12bn merger

A major uncertainty surrounding any combination would be whether the move secures approval from Britain's competition regulator, the Competition and Markets Authority (CMA), given that the deal would effectively create a duopoly.

Any proposed deal is likely to be closely scrutinized by the competition watchdog over concerns it would reduce competition and tighten the grip the four major supermarket chains - Tesco, Sainsbury's, Asda and Morrisons - on the United Kingdom grocery market. Together, they would move ahead of Tesco, with 26.7% of the grocery market. The details of the merger will be spelled out in a Stock Exchange announcement on Monday morning but analysts have already spent the weekend crunching the numbers after the news leaked out on a grey Saturday afternoon.

Retro 90s fashion is a huge trend on the high street at the moment but that nostalgia has now spilled over into food retail as the supermarket giant Sainsbury's attempts a blockbuster deal that will result in it seizing back the United Kingdom grocery crown it surrendered to Tesco in 1995.

Sir Vince said the CMA should force the companies to sell off stores if the merger meant the new giant was dominant in a particular area.

It is understood that any investigation by the Competition Markets Authority (CMA) would only be announced once an intention to merge was formally unveiled. "Part of the merger it to make sure they are protected from that, and also from the growing rise of the discounters".

News of the potential deal also sparked concern among workers' unions, which demanded urgent meetings with Sainsbury's and Asda chiefs.

Saudi coalition airstrike kills 38 Houthis
In Sanaa, Huthi supporters lined the streets Saturday for the funeral of Sammad and six others killed in the April 19 strike. The blockade has since been partially lifted, but access to the impoverished country remains limited.

Sainsbury's and Walmart subsidiary Asda are the second and third largest supermarkets in Britain.

Britain's second-biggest supermarket chain, J Sainsbury, confirmed on Saturday that it is going to come in advanced talks with Walmart Inc.to purchase its United Kingdom operations.

Asda is owned by the world's largest supermarket retailer Walmart and it is not yet clear how the deal would be structured.

It would not be the first time Sainsbury's has acquired another high street giant.

In recent years Walmart has shifted its traditional approach from building overseas businesses itself to partnering with local players, for example in China. In 2016 Sainsbury's purchased general merchandise retailer Argos for 1.1 billion pounds.

George MacDonald, editor of Retail Week, said the grocery industry had been shaken up by low-priced supermarkets such as Aldi and Lidl.


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