The month of November looks set to be a pivotal one in the history of the independent convenience store industry as the much-anticipated wave of consolidation starts to take shape.
The Competition and Markets Authority (CMA) has not yet issued its provisional findings on the conditions for the Booker-Tesco merger to go ahead, although these are expected imminently.
West Sussex Budgens retailer David Knight spoke for many when he said the uncertainty had delayed major investment decisions.
“It feels very much as though we’ve just lost the past year,” he told C-Store. “Hopefully our long wait is about to come to an end, though, and we will get the news that the deal is going through. I think we are on the brink of a major structural change in the symbol market.”
The CMA will also have to give its approval to a take-over of Nisa by the Co-operative Group should members vote to proceed. This week Nisa members have another chance to give feedback on the proposed takeover offer at the second round of regional roadshows held by Nisa and Co-op management.
The meetings run until 7 November, with the final vote on 13 November.
Some members have raised concerns over the proposed financial offer to shareholders, particularly regarding deferred payments over three years and the terms of additional rebate payments.
Bedfordshire retailer Kishor Patel said: “The deal has a good chance of being voted through only if the deal-makers go back to the drawing board and polish the deal with improvement in the price and two-year payment terms with flexibility in the turnover.”
Further consolidation is also likely to develop as Costcutter closes in on a new supply partner, with Bestway the latest to be linked with the symbol group. Costcutter said it was “continuing to explore all possible opportunities”.
CMA to rule on Booker-Tesco merger
The Competition and Markets Authority (CMA) was expected to reveal its provisional findings of the in-depth ‘Phase 2’ investigation of Booker’s proposed merger with Tesco this week or soon after. It opened the investigation in May after concluding that shoppers could face “worse terms” in more than 350 areas where there was currently an overlap between Tesco shops and Booker-supplied symbol stores.
The statutory deadline for the final CMA report is 26 December, and Booker said it was hoping the merger would complete in early 2018.