Asda takeover raises ‘local competition concerns’, says regulator

The Issa Brothers and TDR Capital also own EG Group, which operates 395 petrol stations in the UK, while Asda owns 323. Many of Asda’s and EG’s petrol stations are located in the same parts of the UK and the investigation by the CMA focused on these overlaps.

The CMA found that the deal raises “local competition concerns” in relation to the supply of road fuel in 36 areas across the UK and the supply of a specific type of fuel – called auto-LPG – in a further area. The CMA said it is concerned that the merger could “lead to higher prices for motorists in these locations”.

Joel Bamford, senior director of mergers, said: “Our job is to protect consumers by making sure there continues to be strong competition between petrol stations, which leads to lower prices at the pump. These are two key players in the market, and it’s important that we thoroughly analyse the deal to make sure that people don’t end up paying over the odds.

“Right now, we’re concerned the merger could lead to higher prices for motorists in certain parts of the UK. However, if the companies can provide a clear-cut solution to address our concerns, we won’t carry out an in-depth Phase 2 investigation.”

Bellis now has five working days to offer legally binding proposals to the CMA to address the competition concerns identified. The CMA then has a further five working days to consider whether to accept any offer instead of referring the case to a phase 2 investigation.