Tesco looks set to proceed with its bid to purchase T&S Stores unhindered, following a merger clearance issued by the Department of Trade and Industry.

Despite fears of a concentration of market power, trade secretary Patricia Hewitt, in conjunction with the Office of Fair Trading, decided against referring the case to the Competition Commission.

T&S Stores, the second largest convenience store group in the UK runs 850 stores nationwide and operates the One Stop and Day & Nite names. Tesco now plans to switch 450 of the stores to its Tesco Express format, while the newsagents and discount stores in the T&S portfolio will be sold. Tesco's press manager Jonathan Church said: 'This is very good news for Tesco, as the competition hurdles have now been cleared. The deal should be completed in the New Year and will be great for Tesco customers who will gain access to more stores.' Church added: 'T&S shareholders have yet to give their approval but the deadline for acceptance is the end of the week.'

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