29th Oct 2021 15:39
(Alliance News) - The UK's monopoly watchdog on Friday said it is looking into the GBP7 billion takeover of Wm Morrison Supermarkets PLC, which left the London Stock Exchange this week.
Clayton, Dubilier & Rice won the battle to acquire the Yorkshire-based supermarket earlier in October, after outbidding rival Fortress in a dramatic auction process.
The UK Competition & Markets Authority has, however, served an initial enforcement order, prohibiting any integration following the acquisition.
CD&R's Motor Fuel Ltd forecourt business is of particular interest, amid thoughts it could lessen competition. Morrisons also operates forecourts.
There are parallels with the acquisition of fellow UK grocer Asda. Asda was taken over by Mohsin and Zuber Issa, the owners of forecourt operator EG Group, and private equity firm TDR Capital. Asda sold a number of petrol stations to soothe the CMA's concerns.
Elsewhere in the retail space, the CMA in September said it was mulling blocking a JD Sports Fashion PLC deal to acquire Footasylum.
Lancashire-based sportswear retailer JD Sports proposed the GBP90.1 million acquisition of Footasylum in March 2019. However, the CMA then opened a probe that July as it felt that the merger may lead to a worse deal for shoppers.
In May 2020, JD Sports hit out at the monopoly regulator after the CMA flexed its muscles and blocked the retailer's acquisition of high street outfit Footasylum. In November of last year, a Competition Appeal Tribunal ruling meant that the CMA had to reconsider its decision.
The CMA said last month, however, that the best way to calm competition concerns might be for JD Sports to sell Footasylum.
By Eric Cunha; [email protected]
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