Supermarket groups J Sainsbury and Asda have been forced to abandon their merger after the deal was blocked by the Competition and Markets Authority (CMA).

Sainsbury’s group chief executive Mike Coupe vowed that no distribution centres would be closed in a letter to the House of Commons Business, Energy and Industrial Strategy Committee last year.

Although he admitted that there could be cuts to suppliers currently working with both supermarkets, and a reduction in supplier deliveries had the deal received approval.

In a statement today (25 April) after the publication of the CMA’s final report, which prohibited the merger, Sainsbury’s Coupe said: "The specific reason for wanting to merge was to lower prices for customers.

“The CMA's conclusion that we would increase prices post-merger ignores the dynamic and highly competitive nature of the UK grocery market. The CMA is today effectively taking £1bn out of customers' pockets.

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"Sainsbury's is a great business and I am confident in our strategy. We are focused on offering our customers great quality, value and service and making shopping with us as convenient as possible."

Judith McKenna, CEO of Walmart International, Asda’s owner said: “We have been clear from the beginning of the proposed merger about two things.

"Firstly, that retail is rapidly changing and standing still is not an option, and secondly that we will always ensure our international markets are strong local businesses powered by Walmart.

"It was against that backdrop that we decided to explore the proposed merger with Sainsbury’s – an opportunity which would have further strengthened the Asda business and delivered real benefits for UK customers.”

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