How did the competition commission tame the supermarket giants :: Business and Management Studies

How did the competition commission tame the supermarket giantsThe contestation focusing is an independent public body establishedby the contention cloak 1998. The Competition Commission conductsin-depth inquiries into mergers, markets and the regulation of themajor regulated industries, undertaken in repartee to a reference madeto it by another authority. The Commission lately had the task ofhaving the power to give one major supermarket arrange the go ahead tomerge with Safeway. The proposed acquisition of Safeway by Morrisons,Asda, Tesco or Sainsburys was referred to the militant Commissionunder the Fair Trading Act by the tack and Industry Secretary. TheCommission can consider the opinions of all parties in ascertainwhether any of the authorisation mergers is against the public interest.Topics for inclusion in the meeting could accept both local andnational issues, including the effect on consumers and suppliers ofany proposed acquisition. The Competition Commission gave Morrisonsthe green light over the other potential buyers such as Asda, Tescoand Sainsburys. This was due to a repress of economic reasons. Althoughneither Safeway nor Morrisons was struggling, both agreed the need tomerge was very advantageous. Morrisons was looking for a way to growfar more quickly, and could drop to fund an acquisition to achievethat goal as soon as possible.The successful yell for Morrisons to take over Safeway would mean thatMorrisons would become a major and strong national player. The mergeshould utilise a positive and competitive effect on retail insupermarkets and also benefit the customers. Some people found theMorrisons bid to be against the public interest in particular localareas where the number of competing supermarkets would be decreased.However, subject to divestment of particular stores in these areas.Morrisons bid for Safeway was allowed to proceed. The CompetitionCommission was given just over four and a half months to investigatethe four me rger situations. All of these needed to be assessed as totheir likely impact on competition. Mainly in terms of which would bethe most practical to economy. The decision was partly mad by job isochrone analysis, which is mapping and positioning ofstores area by area and the customers they serve. This provideddetailed teaching on which areas would be affected as a result ofreduced local competition.Morrisons the medium-sized but very fast-growing British supermarketchain takeover of UK rival Safeway deal was worth 2.9bn.The combinedfirm, with 598 stores, a disturbance of 12.6bn and a market share of 16%,aims to be able to vie with Asda, Sainsbury and Tesco, the giantsof the UK supermarket sector. Both Morrisons and Safeway have been