Sainsbury’s share price: MPs to quiz CEO and Asda boss over tie-up

Scrutiny of merger deal intensifies

Sainsbury’s share price: MPs to quiz CEO and Asda boss over tie-up

A parliamentary committee will question the chief executives of J Sainsbury (LON:SBRY) and Asda over their proposed merger, Reuters has reported. The companies agreed the merger in April, with the deal set to create Britain’s biggest supermarket, overtaking current market leader Tesco (LON:TSCO).

Sainsbury’s share price has been subdued in London this morning, having given up 0.33 percent to 305.60p as of 08:39 BST. The decline is largely in line with the broader UK market, with the benchmark FTSE 100 index currently standing 0.33 percent in the red at 7,678.63 points. The group’s shares have added more than 13 percent to their value over the past year, as compared with about a 2.5-percent gain in the Footsie.

MPs to question Sainsbury’s and Asda CEOs

Reuters reported today that MPs from the Environment, Food and Rural Affairs Committee had said that they would gather evidence on the Sainsbury’s and Asda deal, announced earlier this year. The cross-party group will question Sainsbury’s Mike Coupe and Asda’s Roger Burnley on June 20.

“Grocery retailers do not have a great record of treating their suppliers well,” the committee’s chair Neil Parish said in a statement, as quoted by the newswire, adding that the committee was “holding this session to investigate how the biggest potential shake-up of the grocery market in recent years could affect British farmers and suppliers, as well as consumers”.

Competition probe continues

The news comes after the Competition and Markets Authority recently kicked off its own scrutiny of the tie-up, issuing  a preliminary invitation to comment in relation to the deal. The invitation, however, closed on June 4.

Greg Clark, the business secretary, had previously written to the watchdog, urging it to look at the implications of the deal for suppliers as well as consumers.

As of 09:05 BST, Wednesday, 13 June, J Sainsbury plc share price is 305.35p.

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