Morrisons the latest to speak out against Sainsbury’s-Asda merger

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Morrisons has become the latest grocer to warn the CMA that the proposed merger between Asda and Sainsbury’s would severely impact competition.

The retailer told the peak competition authority, which is currently investigating the potential impact of the landmark merger, that the new entity would lead to a duopoly in the grocery sector.

It said that along with Tesco, currently the UK’s largest grocer, the pair would control “in excess of 60 per cent of the market”.

Prices could also rise, Morrisons warned, as the duopoly between the new entity and Tesco would make it possible for them to “compete less fiercely” for “any length of time”.

This comes after Lidl and Waitrose raised similar concerns with the CMA last week, which is seeking the view of interested parties like supermarkets and suppliers as part of its probe, publishing submissions as it receives them.

Lidl warned that the newly-formed entity would “have the capacity to increase prices” on products that do not compete directly on price with the discounters.

Meanwhile, Waitrose warned that the deal could “lead to a homogenous market, in which customers will be offered a reduced range and, ultimately, an increase in prices”.

Tesco has also weighed in on the debate, stating that there were few “customer benefits” of the merger.

“Without any growth opportunity or efficiencies to offer, branded suppliers will not be interested in reducing their prices,” the retail giant added.

When the proposed merger was first announced at the end of April, Sainsbury’s chief executive Mike Coupe said it would lead to £500 million in cost savings and further investment to lower prices by around 10 per cent on everyday items.

Last month, the National Farmers’ Union raised similar concerns about the merger, warning that the £12 billion deal could reduce the choice and innovation of products while increasing the squeeze on farmers.

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15 COMMENTS

  1. I work at asda and there are no concerns from us. It’s what asda needs!! Both sainsbury and asda have both recently culled many colleagues already so jobs won’t be lost. My only concern is that asda colleagues are never informed of anything. We find out info the same time the general public do whereas sainsburys colleagues have already had many meeting with their managers and are filled in regularly.

    • Just for your info sainsburys staff no nothing my girl freind works for the they have not been told any thing. I work for asda and the only info we have had is what the union are telling us then I pass the info on to my girl friend. And if you think there will be no job losses you really need to you think the matter.ask your self why would they keep to supper markets open when they across the road from each other.

    • If you think Sainsbury’s colleagues are better informed than Asda ones, your dead wrong! I have worked for Sainsbury’s for 22 years and we are only ever told what they want us to hear, which isn’t much. If you do ask anything, you normally get told a pack of lies anyway! Moral in Sainsbury’s stores is at an all time low after the callous culling earlier on in the year. We lost all the decent managers and now have a shambolic setup where you don’t even know if you’re going to get payed properly anymore! If you think Asda colleagues are going to benefit, then I think your barking up the wrong tree. The only people going to benefit from this is the CEOs and majority shareholders! Colleagues and customers certainly won’t!

  2. This should not be allowed to go ahead. The current method of dealings of these named Multiples is already squeezing suppliers.
    Managers of each category getting their balls kicked for not creating more profit for their respective supermarket.
    This will ruin competition, ruin suppliers lives which are already hit and ruin farmers forever. The CMA need to do what’s right for the UK market. We are going to shoot ourselves in the foot and ruin thousands and thousands of lives. Wake up CMA!

  3. I work at Sainsbury’s and although I am happy with the merger we are not kept up to date with the latest going on’s.

  4. It is a merger but with Sainsbury’s in greater control, despite what Anonymous says, there will defo be further job losses and the final decision is made at the top, it might seem Sainsbury’s staff are more informed but the truth is, the shop floor is ALWAYS the last to know. Just wait when compulsory store sell-offs start… in a matter of weeks staff will be told their store is shutting or sold to another company.

  5. Believe me colleagues at sainsbury’s only hear the media not from managers. How this merger is going to be beneficial for all Sainsbury’s and Asda colleagues I do not know.

  6. And the suppliers to these chains….what of them. Especially the farmers. Why do they need to merge. Shopping is getting too greedy. Im sticking with the independents.

  7. Sainsbury have only merged because they were losing money and they want all the cake not a slice.
    They can’t compete with Aldi this was the only way they could have that. Sainsbury has always been greedy.
    I worked for sainsbury some years ago they culled some brilliant managers all in one day those managers had to leave the store that day with no notice it was appalling.
    They don’t care about consumers only profits
    They deserve to get stung.

  8. No jobs will not be lost has both companies are staying has they are. Do not jump to conclusions. As for the other stores complaining, cannot think it will effect your position Aldi Lidle and the rest.

    • Hundreds, if not thousands of jobs will be lost if the CMA rules that over 400 stores will need to be offloaded for the merger to go ahead, which has been predicted by both the CMA and other sources.

  9. My wife has worked for Sainsburys for over 25 years and she no-one has a clue what is going on. She was one of the old school who there where not many left who had their sunday premiums taken away from them. Just to be put on the new rate of pay. They were informed that no one would loose any money. But my wife is now £140.per month worse off. This merger would definitely cut more jobs and close stores on both sides. This merger should be abolished outright.

    • Sainsburys colleagues are now on the highest hourly rate in comparison to the other supermarkets, any colleague who was left worse off after the hourly rate change will never lose out on money as they will always get top-up payments to ensure they at least earn what they originally had. In terms of the merger, no one knows whats going on, Including the CMA themselves because they’re still doing the investigation on specific areas around the UK. Everyone needs to calm down, the CMA won’t let it go ahead if it is deemed impactful and less convenient for all customers.

      • You forget to mention that the new rate of pay doesn’t include paid breaks or a bonus payment and the rate is frozen until 2020 at which time other supermarkets will have caught up. And rate does not attract pay rises as it’s above minimum wage. So after 2020 Sainsburys colleagues will be on minimum wage with none of their previous benefits.

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