Asda to divest 13 forecourt stores to address competition concerns over Co-op deal

The Competition and Markets Authority (CMA) has on Tuesday revealed that supermarket chain Asda has agreed to divest 13 petrol filling stations with attached grocery stores to secure the regulator’s approval for its acquisition of 132 forecourts from Co-op.

Earlier this month, the CMA had ruled that the completed acquisition could mean higher prices or less choice for motorists or shoppers in 13 areas after its initial investigation into the deal.

The regulator on Tuesday said “there are reasonable grounds” to accept the undertakings by Asda to divest stores, or a modified version of them.

The CMA investigation focused on a number of local areas in which Asda and the Co-op sites that it acquired compete to provide fuel or groceries to customers, adding that the deal raises competition concerns in 13 locations across the UK, in each of which the merging businesses currently compete for customers and would not face sufficient competition after the merger.

One of the 13 locations, in Earlston, Scotland, raised competition concerns in relation to the supply of both petrol and groceries. The ten other petrol stations that raised concerns are in Barnard Castle; Calcutt, Caledonian Road; Gnosall (Station Road); Lauder; Minsterley; Oakdale (Ripon Road), Harrogate; Rochester; Stonehaven (Kirkton Road); and Weycock Cross in Barry. The two further areas that raised concerns in relation to groceries are the Co-op mid-size stores in St Columb Minor (Henver Road), and East Peckham.