The Competition and Markets Authority (CMA) has launched a probe into the takeover of Asda by Issa brothers who run petrol stations and food outlets worldwide.
The regulator on Tuesday said in a statement that it has decided to begin a formal phase one investigation, after the European Commission decided to refer the matter to the UK.
The CMA said it would examine whether the Asda takeover will result “in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services”.
US retail giant Walmart in October agreed to sell Asda to the billionaire brothers and a private equity group for £6.8 billion.
Mohsin and Zuber Issa joined with private equity firm TDR Capital to purchase Asda, which was last year blocked by the CMA from merging with rival Sainsbury’s.
While the brothers and TDR are acquiring a majority stake in Asda, Walmart will retain an investment and have a seat on the new board.
Born in the town of Blackburn, northwest England, the Issas began their careers working in their father’s local petrol station.
They bought their first petrol station in 2001, which was the start of Euro Garages and which has grown into an international group running 6,000 sites across three continents.
Founded in 1965, Asda has the third biggest market share among supermarket chains in the UK, behind Sainsbury’s and the UK’s largest retailer Tesco. Walmart had bought Asda in 1999.