The proposed supermarket merger between Sainsbury’s and Asda will be subject to a more in-depth investigation by the Competition and Markets Authority.
The CMA said it had found “sufficient concerns” with the deal to warrant a further, more rigorous review of the merger.
The CMA stated: “The companies are two of the largest grocery retailers in the UK and their stores overlap in hundreds of local areas, where shoppers could face higher prices or a worse quality of service.
“These concerns will be considered further in the Phase 2 investigation, along with other issues raised so far with the CMA – including those relating to fuel, general merchandise (such as clothing) and increased ‘buyer power’ over suppliers.'
The new review will be led by an inquiry group chosen by the CMA, with economist Stuart McIntosh already named as the group’s chair. The group are tasked with gathering evidence through surveys with customers, suppliers and industry bodies.
According to the inquiry, it will publish the issues they intend to investigate in the coming weeks. The merger has already raised concerns from the Efra select committee, with chair Neil Parish repeatedly stating the merger will squeeze suppliers and smaller producers.
The CMA inquiry has set itself a deadline of 5 March to finish the in-depth investigation.
