The Competition and Markets Authority has cleared the acquisition of Nisa Retail by the Co-operative Group in a statement published this morning (23 April).
In a release, the CMA state that “after closely examining all the evidence, the Competition and Markets Authority (CMA) has found that the proposed merger does not give rise to competition concerns. During the course of its ‘Phase 1’ investigation, the CMA took into account that Nisa-supplied stores would still be free to set their own prices and decide which products to stock after the merger, and so the merged company would not be able to directly determine how they compete.
“It also examined whether the merged company could raise prices or reduce service quality for retail or wholesale customers. It found that existing retail and wholesale competition made this unlikely. This is because there are enough local alternatives to both Co-op and Nisa-supplied stores to ensure that people could still shop around to get the best value for them.
“Furthermore, Nisa-supplied stores are able to choose between several different wholesalers and would be able to switch supplier if prices were to increase or the quality of service go down as a result of the merger with Co-op. This all means that the merged company would be unlikely to be able to raise prices or offer a worse service to either stores or to shoppers.”
Nisa members voted to approve the deal with the Co-operative Group in November 2017. Subsequently, the CMA’s merger inquiry was launched on 22 February 2018.
ACS submitted evidence to the CMA’s investigation in March. The submission can be found at https://www.acs.org.uk/lobbying/submissions
The full statement from the CMA is available here: https://www.gov.uk/government/news/cma-clears-co-op-nisa-merger
