The Competition and Markets Authority (CMA) vetoed the merger over fears that it would lead to higher prices.
The merger, which would have created the UKs largest supermarket chain, was said to be worth £12 billion, however, fears over higher prices for consumers, reductions in the quality and range of products or a poorer overall retail experience would have come from any tie-up, with the CMA claiming that the deal would have resulted in a “substantial lessening of competition” at both a national and local level for people shopping in supermarkets.
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Mr MacDonald, whose constituency is home to an ASDA area distribution centre and two Asda supermarkets in Stenhousemuir and Grangemouth, welcomed the CMA ruling, as uncertainty over what the merger would mean for workers in the constituency caused concern among staff and the public.
Mr MacDonald said: “This news will come as a great relief to staff who were concerned about the merger, and what it would mean for them. It should also come as welcome news to the thousands of people across my constituency and, indeed, the rest of Scotland, who shop at Asda or Sainsbury’s regularly given the fears over higher pricing and a reduction in quality and range were top of the CMA’s concerns.
“It was only a matter of time before a merger of this scale was proposed, and it has rightfully gone through the process to determine whether or not it would be beneficial to the public for it to have been allowed to happen. Clearly, on this occasion, it has been determined that it would not be beneficial, and will no longer go ahead.
“It is now up to both companies to look at what they can do in a challenging market to reinvigorate their business and ensure that competition is still available for the public, at the same time as protecting their staff and continuing to improve conditions for their workers at stores and sites across the country.”