The Huddersfield Town director at the centre of the £12bn merger of supermarket giants Sainsbury’s and Asda has spoken about the deal.
Roger Burnley, a non-executive director at the football club and chief executive of Asda , said the merger would be good for customers by enabling the Leeds-based retailer to cut prices and offer greater product choice in its stores.
He also insisted that no stores would close as a result of the merger – which requires clearance from the government’s Competition and Markets Authority (CMA).
However, retail analysts speculate that the competitions watchdog could demand Asda axe 75 stores for the deal to go ahead.
Sainsbury’s has supermarkets at Market Street and Shore Head in Huddersfield as well as smaller stores at Lindley and Salendine Nook . Asda has a 24-hour store at Bradford Road. Both retailers also have stores in Dewsbury.
Patrick O’Brien, retail research director at GlobalData, said: “While there are no plans to close any stores at this time, regulators will be looking to see how many Asda stores are in close proximity to Sainsbury’s stores.
“Seventy-five Asda stores have a Sainsbury’s (excluding Locals) in the same sector. We think these 75 stores would be the absolute minimum that the CMA will want disposed of.”
Mr Burnley, who grew up in Dewsbury and attended Heckmondwike Grammar School, spent 10 years with Sainsbury’s before joining Walmart-owned Asda in 2016. His retail background also includes management roles at B&Q and a director at Matalan.
A lifelong Town fan, he joined the Town board in November 2015, and was the first non-executive to join Town under the ownership of chairman Dean Hoyle.
Commenting on the deal, he said: “Asda will continue to be Asda, but by coming together with Sainsbury’s, supported by Walmart, we can further accelerate our existing strategy and make our offer even more compelling and competitive.
“From my six years with Asda and 10 years with Sainsbury’s, I know first hand that both organisations are fortunate to employ some of the most talented and customer-focused colleagues in this market and I am excited by the opportunity of the two coming together.”
He said: “Asda will remain in Yorkshire. It is a proud Yorkshire business and I am a proud Yorkshireman.”
Sainsbury’s said there were no planned store closures as part of the deal, with both brands set to operate side by side.
The merger will see Asda owner Walmart hold 42% of the new business and receive £2.97bn in cash, valuing Asda at £7.3bn. Sainsbury’s is valued at about £5.9bn.
Sainsbury’s and Asda – the UK’s second and third largest supermarkets - will have combined revenues of £51bn and a network of 2,800 Sainsbury’s, Asda and Argos stores. The merger is set to generate £500m in cost savings while the combined supermarket also expects to lower prices by about 10% on products customers buy regularly.
Following the tie-up, Mr Burnley and Sainsbury’s chief executive Mike Coupe will continue in their current roles.
Union Unite has called for guarantees on jobs and demanded meetings with senior bosses at Sainsbury’s and Asda.
Liberal Democrat leader Sir Vince Cable said the CMA “must investigate” any deal, with shadow business secretary Rebecca Long-Bailey echoing the call.
