Sainsbury’s and Asda have been warned by the competition watchdog that nearly 500 of their supermarkets overlap following initial investigations into the £12bn tie-up.
The Competition and Markets Authority said findings of its so-called phase one inquiry into the deal found potential competition issues for stores in 463 local areas.
It raised concerns over 225 Sainsbury’s stores and 238 Asda stores. The revelation raises the prospect of potential widespread store sell-offs in order to see the CMA give the deal the green light.
The CMA last week launched the second stage of its investigation into the merger, which will create a supermarket titan bigger than Tesco, with revenues of £51bn and a network of 2,800 Sainsbury’s, Asda and Argos stores.
In its initial findings it said: “At a local level, the parties’ stores overlap in several hundred local areas across the UK.”