A real revolution has hit the British large-scale distribution. Sainsbury's and Asda (a subsidiary of Walmart), the UK's second and third largest supermarket chains, today announced a £7,3 billion merger.
"Sainbury and Walmart Inc are pleased to announce that they have reached agreement on the terms of a proposed merger between Sainsbury and Asdaa Group," it said in a statement. An important operation that gives birth to a real large-scale distribution giant capable of launching an open challenge to Amazon and the Germans of Lidl but above all to overtake the current market leader Tesco in the UK, thus becoming the largest group of the country in the sector. Speaking in percentage terms: Sainsbury's and Asda together will cover over 31% of the British large-scale retail market – with 2.800 stores and 330 employees – while Tesco reaches 27,6%.
After days of rumors, the official confirmation has arrived. The agreement had in fact been brought forward on Saturday. Based on what has been established, after the wedding, the new company will be controlled 58% by Sainsbury's and 42% by Walmart, the American giant, which took over Asda in 1999.
Walmart will now collect 2,98 billion pounds (about 3,4 billion euros) and receive the equivalent of 4,3 billion pounds in shares: it will thus be able to concentrate on the US market where the battle with Amazon is becoming increasingly tough. In total, Asda is valued at 7,3 billion pounds (about 8,3 billion euros).
Sainsbury's CEO Mike Coupe has promised that the deal will not lead to any store closures or job cuts.
The markets are already busy celebrating the wedding. On the London stock exchange, the Sainsbury's stock is the main beneficiary of the news, which is currently gaining 15% to 310 pounds.
