Amazon eyes Sainsbury’s & Asda stores after merger

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Amazon is reportedly eyeing stores which Sainsbury’s and Asda could be forced to give up in their proposed upcoming merger.

In November, the online giant told the CMA – which is currently investigating the proposed £12 billion Sainsbury’s-Asda tie up – that acquisitions and investments in the UK grocery market were on the table.

“Amazon explained that Amazon Fresh is a recent entrant in the UK. At the moment, they are focusing on how to improve the customer experience,” the CMA said.

According to the competition watchdog, which released the results of its Phase 1 investigation into the proposed merger in September, the “parties’ stores overlap in several hundred local areas across the UK”.

It is thought that Sainsbury’s and Asda could be forced to give up 423 stores in order to for their deal to go ahead, providing low hanging fruit for any retailer eyeing expansion in the UK.

Amazon is likely a contender, having significantly ramped up its efforts to break into the physical retail market throughout this year.

In August, it was revealed that Amazon could be eyeing former Homebase stores, which are due to be vacant as the DIY retailer pushed through a CVA.

Following its purchase of Whole Foods for £10.7 billion last year – a few of which are located in the UK – Amazon has opened two 4 Star physical outlets in the US.

In September, it was also revealed that the online giant was planning to dramatically ramp up its Amazon Go grocery store roll out over the next few years, aiming for around 3000 stores by 2021.

Sources close to the company said chief executive Jeff Bezos hopes to create a format similar to Pret A Manger in the UK, selling freshly-prepared food and a limited number of groceries while utilising its coveted cashierless system.

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