The inquiry by the UK’s competition commission into the possible takeover of supermarket chain Safeway will be wider than the prospective bidders had been expecting.
UK supermarket firms Tesco, Asda, J Sainsbury and William Morrison had been under the impression that the inquiry would be along the same lines as a previous competition commission inquiry into the UK supermarket business, completed in October 2000, reported the Guardian.
Competition commission chairman Sir Derek Morris has revealed at a public hearing regarding the proposed takeover, that the inquiry will investigate the supermarkets’ presence on the non-food market and any impact the merger might have on smaller stores and convenience stores. The previous inquiry had only focused on the market for one-stop food shopping in large stores.
“When we did the last report it [non-food] was very small. Since then one or two supermarkets have been developing that side very significantly, so we do have to ask whether there are any impacts that relate to the non-grocery offering,” Morris was quoted by the Guardian as saying.
Tesco and Wal-Mart subsidiary Asda both have large non-food offerings, while Sainsbury is planning a big non-food launch in September.
Morris said he would also be considering whether to include supermarkets like M&S and Waitrose when assessing local competition issues and whether four big chains would automatically be better than three.
