Wednesday 13 January 2016

4 into 3 or 6 into 5?

Ben Marlow's comment piece in today's The Daily Telegraph is worth a read.

Marlow - a former colleague from time as a cub reporter at and a top hack - makes some interesting points about Britain's beleaguered supermarket sector and the potential for consolidation. In case you missed Marlow's article, here is the link:

Given there were only four major food-focussed supermarket companies in the UK, the general consensus was that any further dealmaking among the major players was highly unlikely for antitrust and competition reasons.

However, today Marlow argues it's possible this year might see the "Big Four go into three", suggesting Sainsbury's might eventually bid for WM Morrison.

Now, I do know from well-placed sources that over the last couple of years J Sainsbury and its advisers have looked at buying quite a few stores from Morrisons - but a bid for the whole company does appear a somewhat far-fetched idea.

Or maybe not: Marlow's comments echo what the former boss of a FTSE 100-listed retailer mentioned to me at a party during the latest festive season. This highly experienced chairman's view was that competition regulators might be more willing to tolerate further consolidation given the success of discounters Aldi and Lidl...

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