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UK regulator delays first word on Sainsbury's-Asda deal

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UK regulator delays first word on Sainsbury's-Asda deal
FILE PHOTO: Shopping bags from Asda and Sainsbury's are seen in Manchester, Britain April 30, 2018. REUTERS/Phil Noble/illustration/File Photo   -   Copyright  Phil Noble(Reuters)
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LONDON (Reuters) – Britain’s competition regulator has delayed plans to publish its initial view on a probe into Sainsbury’s <SBRY.L> proposed 7.3 billion pound takeover of rival Asda <WMT.N>.

The Competition and Markets Authority (CMA) said on Thursday it would notify provisional findings and consider possible remedies in “January/early February”, ahead of the publication of its final report in “early March”.

The CMA had previously said its initial report would be issued in “early January”.

It said the revised timetable was unrelated to Wednesday’s move by Sainsbury’s and Asda to challenge a refusal by the CMA to give them longer to respond to the latest evidence.

The companies are pressing ahead with an application to the Competition Appeal Tribunal (CAT) for a judicial review of the CMA’s phase two investigation of the deal, which started in September.

The companies have asked the CMA for an extra 11 working days over the Christmas period to respond to a large amount of evidence material recently provided to them but the CMA has declined the request.

“The change to the administrative timetable does not relate to the litigation that has been brought before CAT,” a CMA spokesman said.

“We will be vigorously defending our position (on Friday) in the CAT, as we are clear that any further delay to the timetable could be seriously detrimental to the investigation,” he said.

Wednesday’s development sent shares in Sainsbury’s down over 5 percent as it pointed to growing tension between the two companies and the regulator.

Sainsbury’s Chief Executive Mike Coupe had already said last month that the firm would challenge in the courts any unfavourable final ruling by the CMA on the deal if it believed it was not backed up by published evidence.

Sainsbury’s shares were up 1 percent at 1305 GMT on Thursday.

($1 = 0.7906 pounds)

(Reporting by James Davey; Editing by Sarah Young/Keith Weir)

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