OFT to probe Somerfield/Safeway deal
22 stores raise competition concerns
Somerfield’s deal to acquire the 114 smaller Safeway stores from Morrisons is to be investigated by the Competition Commission
The Office of Fair Trading referred the acquisition after deciding that there are local competition issues raised by around a fifth of the stores. With the deal already completed, Somerfield might now be ordered to sell some of the stores.
Penny Boys, OFT executive director, said: ‘We identified 22 mid-range stores and one one-stop store which raised possible competition concerns, using the Competition Commission’s methodology. In light of this, the OFT considers that it is appropriate for the commission to undertake a detailed investigation of the transaction.” The commission is expected to report by September 6.
Somerfield chief executive Steve Back said: “We are disappointed by the OFT’s decision but are confident of a satisfactory outcome. In the meantime, we will continue to operate and benefit from all the acquired Safeway compact stores.”
