Fuel price warning if Asda forecourt mega-merger goes ahead
A MOOTED merger between Asda and its owners’ separate forecourt business could lead to significantly higher fuel prices, a campaign group has warned.
The billionaires – who bought Asda in 2020 for £6.8bn – are reportedly plotting to merge the supermarket chain with their forecourt business EG Group.
The merger could create a new company worth around £12bn, the Times first reported on Saturday.
Nevertheless, Fairfuel UK has called on the competition watchdog, the Competition and Markets Authority (CMA) to investigate the deal – fearing a hit to consumers.
“Asda pump prices have been the lowest across the nation for decades, but I and most motorists are not convinced any merged deal will settle at the Supermarket’s traditionally much lower fill up prices,” Fairfuel’s founder Howard Cox said.
“That’s why the government’s watchdog must step in and protect the UK’s 37 million drivers from yet more fuel supply chain exploitation, in this case through greedy takeovers that will only benefit very much in debt opportunistic businessmen.”
Cox’s comments were echoed by Simon Williams, fuel spokesperson at the RAC.
“If the merger were to make Asda any less competitive, this would be bad news as there would be even less incentive for other retailers to compete on price, as well as fewer better value places to fill up,” Williams told City PM
It comes as small business minister Kevin Hollinkrake said business secretary Grant Shapps already raised concerns “about fuel prices with the CMA and directly with retailers.”
Both the CMA and BEIS were approached for comment.
Campaigners have called on the retailers to cut down on forecourt prices, as the cost of petrol and diesel is still too high for most motorists.
According to Luke Bosdet, road fuel spokesperson at the AA, competition needs to be “stimulated with fuel price transparency, as it is the case in Northern Ireland with the fuel price checker.”
Deployed by the Consumer Council in Northern Ireland, the price checker is an interactive map that allows motorists to check where prices are lower by showing the average cost of diesel and petrol in towns and cities across the country.
A government spokesperson said: “The CMA is the independent regulator with responsibility for scrutinising mergers to ensure that they do not reduce competition in the market. Competition is important for creating choice and low prices for consumers, as well as incentivising business investment and growth.”