Sainsbury's and Morrisons held merger talks, industry eyes consolidation

Summarised from 2 outlets · Updated 9 Oct, 10:00 · Archive

Sainsbury's and Morrisons held merger talks between November and February before the larger chain decided not to proceed.

Sainsbury's and Morrisons held merger talks from November to February, with the larger chain ultimately deciding not to pursue the deal. The news has prompted industry speculation about consolidation among Britain's major supermarket chains.

Industry experts suggest the three largest chains—Sainsbury's, Asda and Morrisons—are informally discussing possibilities. One analyst said a combination of Asda and Morrisons could occur, though it would be a weaker deal than a Sainsbury's takeover of either, given both businesses struggle with costs and debt. The Guardian reports that industry watchers predict either Asda or Morrisons, or both, could disappear within a decade.

Sainsbury's previously attempted to buy Asda for £7bn in 2019 but the deal was blocked. The supermarket group now appears at least willing to consider buying troubled rivals. Tesco boss Ken Murphy declined to comment on merger speculation, saying he does not 'overthink possible permutations and combinations'. Tesco itself raised its annual profit forecast following strong first-half results.

How it is being reported

• Tesco boss issues response after bombshell Sainsbury’s-Morrisons merger rumourTesco boss Ken Murphy has commented on Sainsbury's-Morrisons merger rumours as the supermarket giant raised its annual profit forecast.Daily Express · 9 Oct, 09:38
• Supermarket shake-up: why Asda or Morrisons could vanish within a decadeTalks between Sainsbury’s and Morrisons have set industry tongues wagging, with analysts saying the market is ripe for change Tesco lifts profit forecast and says shoppers are resilient Business live – latest updates They may be two of the most recognisable brands in Britain, with a combined 188 years serving shoppers, but industry watchers agree that either Asda or Morrisons – or both – could disappear within a decade. This week, it emerged that Sainsbury’s and Morrisons – the UK’s second- and sixth-largest supermarket chains – had held merger talks between last November and February…The Guardian · 8 Oct, 11:00

In this story: Sainsbury's · Morrisons · Asda · Tesco · Ken Murphy · Simon Roberts

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