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Kidswear to come under scrutiny in merger investigation

Childrenswear will be coming under particular scrutiny in an in-depth investigation into the proposed merger of Sainsbury’s and Asda.

A statement from the Competition and Markets Authority (CMA) has revealed that the merger will undergo an in-depth Phase 2 study once the initial Phase 1 investigation is complete, and childrenswear has been named as one of several new areas up for scrutiny.

The investigation will pay close attention to the affect on the competition for children’s clothing in the marketplace and will consider the level of competition provided by a broad range of competitors (beyond main rivals Tesco and Morrisons) such as budget chain Aldi and online non-grocery retailers.

The investigation aims to assess whether Sainbury’s purchase of Asda will lead to higher prices, a poor shopping experience and lower quality of products for shoppers.

“We are setting out a number of areas that we expect to look at as part of our investigation,” said Stuart McIntosh, chair of the independent inquiry group.”We welcome views on the effects of the merger and will carefully consider any evidence that we receive.”

The CMA will announce its provisional findings early next year, with a final decision by 5 March 2019.

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