CMA provisionally clears Morrisons’ proposals for McColl’s deal

The CMA launched its investigation in July 2022 following Morrisons’ £190m purchase of fellow retailer McColl’s, which had entered into administration in May. 

Following its initial investigation, the regulator found the deal would not harm the vast majority of shoppers or other businesses - however, it raised competition concerns in 35 areas. These were accepted by the two retailers and engaged with the CMA in discussing potential remedies. 

As such, Morrisons has offered to divest 28 of McColl’s stores to a purchaser or purchasers approved by the CMA - including 26 stores in England, one in Scotland and one in Wales. 

The CMA has said it is “minded to accept these proposals” as it believes it’s suitable to restore the loss of competition brought about by the deal across each of the 35 areas. While the number of McColl’s stores Morrisons is proposing to sell is lower than the number identified, the sale of some stores would address the concerns in multiple areas. 

The regulator is now consulting on the proposals. If it’s accepted, the deal would be cleared to proceed. 

The CMA’s senior director of mergers Sorcha O’Carroll said: “Our preliminary view is that the sale of these stores will preserve competition in these local areas and prevent consumers from losing out due to this deal, at a time when shoppers are already facing rising prices.

“If, after reviewing the responses to our consultation, we conclude that the competition issues have been addressed, the deal will be cleared.”