The Competition and Markets Authority (CMA) has launched a surprise investigation into the Sainsbury’s takeover of Argos owner Home Retail Group.
The CMA is will examine the deal to highlight if the merger would result in a ‘substantial lessoning of competition’ within the UK market.
In a statement published on 27 May 2016, The CMA said: “The CMA is considering whether it is or may be the case that this transaction has resulted in the creation of a relevant merger situation under the merger provisions of the Enterprise Act 2001 and, if so, whether the creation of that situation has resulted, or may be expected to result, in a substantial lessening of competition within any market or markets in the United Kingdom for goods or services.”
Sainsbury’s won the bidding war for Home Retail back in March with a £1.4bn bid. The CMA will accept responses until 13 June and should make a decision by 25 July 2016.
A Sainsbury's spokesperson commented to the BBC: "The combination of both businesses will create a multi-product, multi-channel proposition with fast delivery networks, benefiting customers by accelerating our strategy to give them what they want, where and when they want it. We look forward to the successful completion of the deal."