CMA confirms deadline extension on Sainsbury’s-Asda probe

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Sainsbury's-Asda
// Final outcome of CMA probe into Sainsbury’s-Asda merger delayed to April 30
// Provisional findings to be revealed imminently
// Extension of deadline comes after legal tussle on time timeframe

The CMA has confirmed that its final verdict on the proposed Sainsbury’s-Asda merger will be delayed by almost two months to April 30.

In a statement, the UK’s peak competition regulator cited the “scope and complexity” of its probe into the proposed £12 billion tie-up along with the need to consider issues raised by the two retailers and third parties.

It comes after Sainsbury’s and Asda challenged the CMA’s timeframe in court in December, saying the “unprecedented scale and complexity” of the deal required additional time.

The CMA defended its original deadline, saying it was “not willing to compromise on the thoroughness or objectivity” of its investigation.

However, the Competition Appeal Tribunal ended up allowing the CMA to have an extension for its final decision.

A statutory period for the investigation was originally due to expire on March 5, but the inquiry group looking into the case has now said there are “special” reasons to extend this.

“In taking this decision, the inquiry group had regard to the scope and complexity of the investigation and the need to consider issues raised by the main parties’ and third parties’ submissions, and the need to reach a fully reasoned provisional decision,” Stuart McIntosh, who is chairing the inquiry, said.

“Moreover, it is necessary to allow sufficient time to take full and proper account of comments that will be received in response to the inquiry group’s provisional findings and to reach a fully reasoned final decision in the statutory timeframe.”

Although the delay was widely expected, the CMA is expected to reveal its provisional findings on the merger imminently.

It is not allowed any further extensions around the final decision.

The mega merger was first announced in April last year.

As part of its probe on the proposal, the CMA sought the views of interested parties like supermarkets and suppliers, publishing submissions as it received them.

Tesco, Morrisons, Lidl and Waitrose have all expressed concerns about price rises and competition fairness while the National Farmers’ Union warned that the merger could reduce the choice and innovation of products and increase the squeeze on farmers.

Sainsbury’s chief executive Mike Coupe said the merger would lead to £500 million in cost savings and further investment to lower prices by around 10 per cent on everyday items.

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