Sainsbury’s chairman speaks out against mega-merger criticism

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Outgoing Sainsbury’s chairman David Tyler has written an open letter in the Financial Times responding to criticism of the proposed mega merger between his supermarket and Asda.

Unpacking comments made by Financial Times markets columnist Neil Collins, Tyler said the journalist had failed to “reflect the facts fairly” over the proposed £12 billion merger between the two of Big 4 supermarket retailers.

The rationale for our merger with Asda is to create the savings we need to lower prices for customers,” Tyler wrote.

“Customers are very quick to vote with their feet.

“The deal will be successful only if we deliver on the commitment we have made to reduce prices on everyday items by around 10 per cent.

“We will not be looking to harm small suppliers or cripple their ability to develop new products.

“Small, nimble businesses are the lifeblood of our company and play a crucial role in helping us offer distinctive products.”

Tyler’s letter comes as the CMA continues to probe the propised merger, including the impact it would have on suppliers.

Speaking on the threat of Tesco and discounters Aldi and Lidl, Tyler said Sainsbury’s is currently playing catch-up on purchasing costs.

He added that the merger would mean the new supermarket could match the volume benefits Tesco, Aldi and Lidl already have.

“The merger is the right way to make savings: it makes the grocery products we sell cheaper and does not cut costs by downsizing,” he said.

“That way, both our millions of customers and all colleagues across Sainsbury’s and Asda benefit,.”

Tyler will step down from his position as chairman this week after nine years in the role, with Martin Scicluna replacing him on November 1.

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