Poundland gets green light for 99p Stores deal
The competition watchdog has given its blessing to Poundland’s £55 million acquisition of rival discount chain 99p Stores.
The tie-up has been under investigation by the Competition & Markets Authority (CMA) since April amid concerns it would substantially reduce competition in the market.
However, its inquiry group of independent panel members found that “customers would not face a reduction in choice, value or lower-quality service” as a result of the deal.
The enlarged group, comprising about 800 shops, would still face competition from rival “value retailers” B&M, Bargain Buys, Home Bargains and Wilko, along with supermarkets Tesco and Asda.
Poundland chief executive Jim McCarthy said: “We continue to believe that the acquisition of 99p will be great for customers and for shareholders alike.”
CMA inquiry group chair Philip Marsden added: “Poundland would continue to face competition from other value retailers.
“We have also seen in recent years the “big four” supermarkets engaging in intense price competition, some of which involving the promotion of £1 products. On the basis of the evidence to date, we do not think customers will be worse off from the merger.”
The CMA, which surveyed more than 5,000 customers, has given a deadline of 16 September for responses to its provisional findings.