Competition watchdog to probe Morrisons’ purchase of McColl’s

REUTERS/Toby Melville/File Photo

Britain’s competition regulator said today (30) that it will investigate supermarket group Morrisons’ purchase of convenience store chain McColl’s out of administration.

The Competition and Markets Authority (CMA) will examine whether the deal results in a substantial lessening of competition.

Earlier this month, Morrisons, which has a wholesale supply deal with McColl’s, took on all its 1,160 stores, including 270 Morrisons Daily branded stores, in a so-called pre-pack administration.

Morrisons, which trails market leader Tesco, Sainsbury’s and Asda, has been owned since October by U.S. private equity group Clayton, Dubilier & Rice (CD&R).

Earlier this month, Morrisons had won a battle against the owners of rival Asda to buy collapsed convenience store chain McColl’s.

Morrisons had an existing supply agreement with McColl’s, for which it provided a range of products under the Safeway brand. Morrisons is owned by the the US private equity group Clayton, Dubilier & Rice, which won a takeover battle for control of the chain last year.