…By Joseph Benjamin for TDPel Media.
Asda and EG Group, a petrol station business, could potentially merge, creating a risk of job losses, food supply disruption, and monopolisation of petrol stations across the UK.
The GMB Union, which represents retail and distribution workers, has written to Business Secretary Kemi Badenoch, urging her to call in the competition regulator to investigate the potential deal.
The union argues that a merger could add to Asda’s already substantial debt burden and put over 100,000 jobs at risk.
EG Group is one of the largest petrol station businesses in the world and is due to refinance its £7 billion debt by 2025.
The merger could create an empire owning over 700 petrol stations across the UK, potentially leading to a monopoly and reduced competition on fuel prices.
The union likens this to the collapse of Debenhams, which went into administration in 2019 after being burdened with £1 billion of debt.
The GMB Union has asked the competition regulator to investigate the deal if it goes ahead to prevent reckless financial engineering that risks jobs and poses a threat to the UK’s food supply.
The concerns raised by the GMB Union are significant, especially with regards to the potential risk to the UK’s food supply system.
A merger that puts more debt on Asda could have a significant impact on the already heavily-indebted supermarket chain.
The monopoly that could be created by the merger could also have negative implications for fuel prices and reduce competition in the UK petrol market.
It is important that the competition regulator conducts a thorough investigation of the potential deal to protect jobs and ensure fair competition.
The regulator has warned that the deal could result in “higher prices or less choice” for drivers and shoppers across 13 sites.
The outcome of this investigation could also have a significant impact on Asda’s potential merger with EG Group’s UK petrol stations.
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