As Sainsbury’s accuses CMA of taking £1billion out of customers’ pockets by blocking the deal, Asda and its parent firm, Walmart said they were “right to explore merger” with fellow UK grocery chain, Sainsbury’s, adding that its main aim was to provide savings for shoppers in a highly-competitive market.
Following the Competition and Markets Authority (CMA) ruling that it has no other option but to block the proposed merger between the two grocery giants, it was announced that Asda, its parent Walmart and Sainsbury’s have mutually agreed to terminate the transaction.
Asda expressed disappointment over CMA’s decision and final report on the deal. CEO Roger Burnley said today: “Asda’s DNA is delivering low prices for hard-working families and that will never change. We were right to explore the potential merger with Sainsbury’s, which would have delivered great benefits for customers and supported the long term, sustainable success of our business.
"We’re disappointed with their findings but will continue to find ways to put money back into customer’s pockets and deliver great quality and service in an ever changing and demanding market.
"I have always been hugely aware that the last year has been an unsettling time for all of our colleagues and am immensely grateful for their commitment and dedication during that time. Our focus is now on the most important job we all have – delivering for our customers.”
His response follows comments from Sainsbury’s CEO Mike Coupe, who said shoppers will be the ones who lose out, stating: “The CMA is today effectively taking £1billion out of customers' pockets.”
Meanwhile, Walmart International CEO Judith McKenna also defended the grocer’s intentions for the proposed deal: “We have been clear from the beginning of the proposed merger about two things. Firstly, that retail is rapidly changing and standing still is not an option, and secondly that we will always ensure our international markets are strong local businesses powered by Walmart.
"The UK remains one of the most competitive retail markets in the world and Asda’s seven consecutive quarters of year-on-year growth show it is a strong business with a clear strategy and focused leadership.
"It was against that backdrop that we decided to explore the proposed merger with Sainsbury’s – an opportunity which would have further strengthened the Asda business and delivered real benefits for UK customers.
"While we’re disappointed by the CMA’s final report and conclusions, our focus now is continuing to position Asda as a strong UK retailer delivering for customers. Walmart will ensure Asda has the resources it needs to achieve that.
“I would like to personally thank and recognize [sic] Roger and the entire Asda team for their incredible focus and approach during the merger process. They have had the customer at their heart at every step, and I know they will continue to do so.”
A more detailed look at the CMA’s investigation and ruling can be found here