The Competition and Markets Authority (CMA) is considering remedies offered by Co-op Group, including the sale of 15 convenience stores, to address competition concerns identified during its phase 1 investigation of Co-op’s acquisition of Southern Co-op.
The CMA is concerned that reduced local competition could harm convenience-store shoppers in these areas. The phase 1 investigation found that the merger could reduce competition in grocery retail in local areas around some Co-op Group and Southern Co-op convenience stores. It also identified concerns about attended funeral services in areas served by funeral homes operated by these businesses.
Fast-tracked investigation and proposed remedies
During the investigation, both businesses accepted that the deal raised the above competition concerns and asked to fast track the investigation so they could offer undertakings to address these concerns. Since then, the businesses have engaged constructively with the CMA on finding effective possible remedies.
Having provisionally found that the proposed sales in each local area put forward by the businesses could address the CMA’s concerns, the CMA will now proceed to consider them in more detail, including seeking third-party feedback and then considering potential buyers. If the CMA is satisfied that the undertakings address its concerns, it will conditionally clear the deal.
CMA statement on protecting local competition
Joel Bamford, executive director for mergers at the CMA, said: “We were concerned that this merger could reduce competition for convenience store shoppers and people arranging funerals in several local areas in southern England.
“The businesses have engaged constructively to find a solution to these concerns and offered to sell stores and funeral homes in each of the problematic areas.
“Having reviewed these proposals, we provisionally believe they could resolve our concerns and allow us to clear the deal while protecting competition for the benefit of people in these local communities.”
