CMA blocks proposed Sainsbury’s-Asda merger

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CMA blocks proposed Sainsbury’s-Asda merger

CMA blocks proposed Sainsbury’s-Asda merger
By Elias Jahshan -
April 25, 2019
The UK’s peak competition regulator has blocked the proposed £12 billion merger of Sainsbury’s and Asda, delivering a blow to the grocery giants who wanted to combine to overtake longtime market leader Tesco. The CMA said the deal would lead to increased prices in stores, online and at many petrol stations across the UK.

Sainsbury’s and Walmart, the US parent company of Asda, responded to the decision by mutually agreeing to terminate the proposed deal – which was first announced in April last. 
In its final report into the deal, the CMA said shoppers and motorists would be “worse off” if Sainsbury’s and Asda were to merge. It said the tie-up would lead to price rises, reductions in the quality and range of products, and a poorer overall retail experience.

The watchdog also said the deal would have resulted in a “substantial lessening of competition” at both a national and local level and that shoppers right across the UK would be affected – not just in the areas where Sainsbury’s and Asda stores overlapped.