You may have heard about the recent merger that will take place in the UK between two household names, but what is being said about it?
Rivals Asda and Sainsbury’s are joining forces, but why? Sainsbury’s has confirmed plans to unite with Asda in a historic £7 billion deal after a series of negotiations with US giant Walmart, the US owner of Leeds-based Asda. This is based from Asda being the lowest performer of the four main supermarkets in Britain for some time and both companies have struggled to come close to the performance of market leader Tesco. All companies have also suffered due to the emergence of discount stores like Lidl and Aldi. It is a need for ‘survival’.
What will happen to the brands and stores? Both companies claim that they will retain their own brands – in other words, your local Asda will not suddenly turn into a Sainsbury’s. The two companies also said there were no plans to close Asda or Sainsbury’s stores as a result of the merger. Although speculation does hover over this as people can never be too sure what will happen.
How will this impact customers? Sainsbury’s and Walmart bosses have said that they hope the merger will provide customers with a 10% reduction in prices. They have also said that across the 2,800 stores and websites customers will have greater choice of goods and a more flexible and efficient way to shop.
What will happen to the staff? It has been said that there will be no job losses in stores and that the merger will offer more opportunities for staff at all levels. But unions have still expressed concern about the deal and have argued that the merger is in the interests of shareholders, not customers and staff.
What will this do to the supermarket rankings? With the companies’ combined, they will be responsible for a third of all UK grocery sales – which would put them ahead of market leader Tesco.
Although, an unfortunate clip has gone viral after the CEO of Sainsbury’s Mike Coupe was filmed singing ‘we’re in the money’ after an agreement was reached for his company to merge with supermarket rivals Asda between TV interviews.
“This was an unguarded moment trying to compose myself before a TV interview. It was an unfortunate choice of song, from the musical 42nd Street which I saw last year and I apologise if I have offended anyone.” – Mike Coupe.
Not the best timing and it sure has caused a stir as unions are very cautious about the new proposal. To see the video, follow the link here.
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