Tesco (LON:TSCO) has said that the proposed merger of its ‘Big Four’ rivals J Sainsbury (LON:SBRY) and Walmart’s Asda should not go ahead unless ‘extensive remedies’ are provided by the companies, The Times has reported. The comments come amid the ongoing Competition and Markets Authority (CMA) investigation into the tie-up.
Tesco’s share price has fallen into the red in today’s session, having given up 0.81 percent to 195.85p as of 08:48 GMT. The stock is underperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.03 percent lower at 7,060.67 points. The group’s shares have added a little over two percent to their value over the past year, as compared with about a 3.6-percent dip in the Footsie.
Tesco weighs in on Sainsbury’s-Asda deal
The Times reported this morning that Tesco had said in a hearing with the CMA that the merger between Sainsbury’s and Asda should not go ahead unless ‘extensive remedies’ are provided by its rivals. Tesco further questioned the rationale behind the tie-up and suggested that it could lead to higher petrol prices in some areas.
The watchdog is currently investigating the potential impact of the proposed deal which is set to create Britain’s biggest grocer, surpassing Tesco. Last month, the National Farmers Union warned that the proposed deal could increase pressure on farmers.
Analysts on Britain’s biggest supermarket
The 14 analysts offering 12-month price targets for Tesco for the Financial Times have a median target of 280.00p on the shares, with a high estimate of 300.00p and a low estimate of 200.00p. As of December 1, the consensus forecast amongst 21 polled investment analysts covering the blue-chip supermarket has it that the company will outperform the market.