NI stores and staff at risk as Sainsbury's and Asda merge

Thousands of supermarket staff in Northern Ireland are facing an uncertain future after details of Sainsbury's shock £12 billion merger with Asda appeared.
The proposed Sainsburys and Asda merger has still to be approved by the Competition and Markets AuthorityThe proposed Sainsburys and Asda merger has still to be approved by the Competition and Markets Authority
The proposed Sainsburys and Asda merger has still to be approved by the Competition and Markets Authority

Sainsbury’s, the UK’s number two supermarket, has agreed terms for a merger with Walmart-owned Asda –the third biggest supermarket – setting the stage for one of the most audacious deals in British retail history.

Bosses at the grocery giants initially insisted no stores would close as a result of the deal, but yesterday admitted regulatory authorities could force them to offload stores as part of a competition probe.

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While an exact number of store closures was not divulged by the chains, numbers crunched by research firm GlobalData show that “at least” 75 UK stores where Sainsbury’s and Asda overlap are at risk.

GMB, the union for Asda workers, has warned that “huge questions remain” about the potential impact on the combined 330,000 UK workers employed by the supermarket giants, which includes thousands of workers in Northern Ireland.

The union’s general secretary Tim Roache claimed workers had been “kept in the dark” about the merger and called on Asda to offer “answers and reassurances” about their futures.

The planned merger will see Asda owner Walmart hold 42% of the new business and receive £2.97 billion in cash, valuing Asda at £7.3 billion. Sainsbury’s is valued at around £5.9 billion.

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The combined supermarket expects to lower prices by around 10% on products customers buy regularly.

However, the merger has to be approved by the Competition and Markets Authority.

Glyn Roberts of Retail NI warned that the planned move would be a “significant game changer for grocery retailing, locally and nationally”.

He told the News Letter: “If this merger takes place, £1 in every £3 spend will be spent in this new giant. Retail NI has concerns about the impact this would have on squeezing many smaller suppliers as this new business will have huge buying power.”

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Mr Roberts said that, whatever the outcome of the proposed merger, the Province’s local independent grocery sector “is up for the challenge”.

He added: “I think there will be some trepidation on the part of our members but I have no doubt they will meet this challenge head on.”

Asda currently employs around 4,000 staff in Northern Ireland across 17 stores, including an Asda Living store in Belfast city centre.

The other stores are located in Cookstown, Portadown, Antrim, Omagh, Belfast (one on Kennedy Way and another on Shore Road), Ballyclare, Strabane, Dundonald, Coleraine, Larne, Newtownards, Bangor, Enniskillen, Downpatrick and Kilkeel.

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Sainsbury’s was unable to provide a figure for the number of stores it operates in Northern Ireland or how many staff it employs in the Province.

However, online business directory Yell shows there are stores in Carrickfergus, Coleraine, Bangor, Belfast, Newry, Dungannon, Lisburn, Armagh, Ballymena, Londonderry and Craigavon.

Latest figures show that Tesco has a 27.6% market share in the UK, while Sainsbury’s has 15.8% and Asda has 15.6%. If the merger goes ahead, the duo would have 31.4% of the market.