Proposed acquisition by Sainsbury’s of 171 Somerfield stores referred to the Competition Commission

The proposed acquisition by Sainsbury’s of 171 Somerfield stores referred to the Competition Commission

On the 30 July 2003 the proposed acquisition by J Sainsbury of 171 Somerfield Stores from the “Springwater” Bidding Group was referred to the Competition Commission by the Secretary of State for Trade and Industry, Patricia Hewitt. Her decision was made in accordance with advice from the Office of Fair Trading (OFT).

Mrs Hewitt said:
“The OFT has advised me that there is a significant prospect that
this proposed acquisition may be expected to result in a substantial
lessening of competition. It would lead to a substantial number of
overlaps at the local level between Sainsbury and Somerfield stores.
Determining the loss of competition will require a detailed assessment by the Competition Commission of each local area in which an overlap occurs.

“I have considered the OFT’s advice and accept its conclusions. I am therefore referring the proposed merger to the Competition Commission so that it can be fully investigated.”

The decision to make a reference does not in any way prejudge the question of whether or not the proposed merger would be against the public interest. It is for the CC to report on this after investigation.