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September 02, 2005
Competition Commission rules Morrisons must sell Somerfields stores
The Competition Commission has ruled that supermarket group, Somerfield, must sell 12 of the stores it acquired from WM Morrison, as part of a £260m contract in 2004, in order to prevent a "substantial lessening" of competition in the local areas of the stores.
The Commission had originally expressed concerns over 14 of the 115 Morrison stores acquired by Somerfield, but it reduced the number after Somerfield eased concerns that the acquisitions of sites at Bedlington and Paisley would impact on the local grocery market.
Somerfield’s board will consider the Commission’s findings at its meeting on Thursday 8 September.
In July, Somerfield criticised the Competition Commission for intervening in the deal. It said the regulator had put "the cart before the horse" when it made its provisional report into the takeovers, and that the Commission had acted on a "theoretical possibility" that the group would act in a certain way after it had acquired the stores.
The ruling means that Somerfield will have to sell stores in Filey, North Yorkshire; Middlesbrough Linthorpe; Newark; Pocklington, East Riding; Poole Bearwood; South Shields; and Whitburn in West Lothian.
In Johnstone, Renfrewshire; Peebles in the Scottish Borders and Yarm at Stockton-on-Tees the group can either sell its newly bought stores or close its existing outlet.
The Commission also said that Somerfield must sell off stores it has already closed in Kelso and Littlehampton.
Posted by at September 2, 2005 11:23 PM
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