Morrisons’ offer to address competition concerns could see it pushing through the rescue takeover of convenience chain McColl’s, according to the Competition and Markets Authority (CMA).
The UK competition watchdog has previously raised concerns over 35 locations where it saw the potential for reduced competition between McColl’s, Morrisons and Motor Fuel Group – which is owned by Morrisons’ parent firm.
The potential competition concerns were described as being in a “small number of local areas”.
The exact nature of Morrisons’s undertakings have not been disclosed but the disposal of certain stores is expected to ease competition concerns in more than one area. The number of stores is expected to be slightly below 35, addressing the concerns raised by the CMA earlier this month.
In today’s official statement, the CMA said: “Morrisons offered undertakings to the CMA, which involve divesting convenience stores.
“The CMA considers that there are reasonable grounds for believing that the undertakings offered by Morrisons, or a modified version of them, might be accepted by the CMA under the Enterprise Act 2002.”
Morrisons agreed to buy McColl’s as part of a rescue deal in May after the convenience retailer collapsed into administration in light of soaring costs due to supply chain disruption, inflation and its large debt burden.
The CMA first launched a phase-one investigation into the move back in July, following concerns the takeover could lessen competition in a number of areas.
The supermarket giant has worked closely with the CMA throughout, saying earlier this month that it was “looking forward to a swift conclusion of the process.”
“As the cost-of-living soars, it’s particularly important that shops are facing proper competition so that customers get the best prices possible,” CMA senior director of mergers, Sorcha O’Carroll said at the time, pointing out that the “vast majority” of shoppers and other businesses won’t lose out.
