Thursday, July 27, 2017

Nisa CEO warns Tesco merger will cause “enormous amount of pain”

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Nisa’s boss has warned that the landmark merger between Booker and Tesco would cause an “enormous disruption” to the convenience industry.

As the leader of one of a convenience store chain that is in direct competition with the Booker-supplied estate, which includes Londis, Budgens and Premier, Nick Read said it would be “churlish” to say the £3.7 billion deal wouldn’t threaten Nisa.

He cautioned this would give the Booker estate greater range, buying power and ability to slash prices.

“I can’t imagine there isn’t going to be enormous disruption over the next 18 months,” Read said, speaking publicly about the deal for the first time at a trade show this week.

“I think there’s going to be an enormous amount of pain and consequently quite a bit of fallout.”


READ MORE: Tesco could be forced to give up 100s of convenience stores amid merger


He went on to argue that the deal could in fact be an opportunity for Nisa, as the merger would force the companies to “take their eye off the ball”.

It was revealed earlier this week that a Competition and Markets Authority (CMA) investigation into the deal could result in Tesco giving up hundreds of its Express convenience stores.

Nisa’s push to make the process of signing new members and converting them to a branded, more efficient store could help it capitalise on the fallout from Tesco’s takeover.

Read told Talking Retail said: “There will be uncertainty among Budgens, Premier and Londis retailers. We do see opportunities that will present themselves, and professionalising our recruitment team is a way of exploiting that.”

This comes as Nisa reported a 2.2 per cent rise in like-for-like sales over its fourth quarter hitting £299 million in total sales.

Tesco and Booker are expected to announce their deal to the CMA by the end of the month, which will trigger the investigation into the proposed merger.

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