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The Guardian - UK
The Guardian - UK
Business
Graeme Wearden

Microsoft hits $1tn valuation; Sainsbury-Asda merger blocked - as it happened

The Microsoft sign is shown on top of the Microsoft Theatre in Los Angeles, California.
The Microsoft sign is shown on top of the Microsoft Theatre in Los Angeles, California. Photograph: Mike Blake/Reuters

And finally, Microsoft’s share have ended the day solidly in the green, up 3.3% at $129.15.

That means the software giant’s value has just dropped below $1tn again (at around $990m, I think). But it’ll still hold the record of being the third tech firm to burst into the ten-digit club, thanks to last quarter’s strong earnings - particularly on the cloud side.

Goodnight! GW

Here’s our news story about Microsoft’s climb to the ranks of the one-trillion dollar companies.

Updated

Sainsbury’s travails helped to drag Britain’s FTSE 100 index into the red too.

It finished 37 points lower at 7,434, down 0.5%.

House builders also dipped, after Taylor Wimpey warned that the cost of building new homes was rising.

Back in London, Sainsbury shares have closed almost 4.7% lower, as the City digests the collapse of the Asda merger.

At 216p, that looks like the lowest close in 33 months, and not far off a 30-year low.

Microsoft and Facebook have helped to push the Nasdaq index of technology stocks to a new all-time high, over 8,138 points.

But the Dow Jones industrial average is looking rather sicklier. It’s down 249 points or nearly 1% at 26,347 points. 3M is doing some damage, down around 10% after its disappointing results today.

Facebook is also romping higher, after posting strong results after the market closed yesterday.

Shares in the social media giant is up 7% to $195, the highest level since plunging by a quarter last July.

Last night it smashed forecasts with a 26% jump in quarterly revenues to over $15bn. It also reported an 8% rise in active users.

Facebook shares

This helped investors to shrug off Facebook’s warning that it could be fined $5bn by the FTC for privacy violations.

Mark Zuckerberg struck an upbeat tone, telling analysts:

“We had a good quarter and our business and community continue to grow.

We are focused on building out our privacy-focused vision for the future of social networking, and working collaboratively to address important issues around the internet.”

Updated

Microsoft has overtaken Apple to become the most valuable tech company in the world.

Apple (which hit the $1tn mark last summer) is currently worth around $976bn. Amazon is close behind, at $940bn.

Microsoft hits $1tn valuation

Boom! Microsoft is officially worth $1 trillion dollars, after impressing Wall Street with its latest financial results.

Shares in the software, cloud computing and games console firm have jumped almost 4.5% to $130.66 at the start of trading in New York.

That’s a new all-time high, pushing its market capitalisation over $1,000,000,000 for the first time ever.

Investors are cheering Microsoft after it posted a 14% increase in sales in the last quarter, largely driven by its cloud computing arm where revenues surged by 41%.

Wall Street movers, April 25 2019

Azure, its enterprise cloud computing business, swelled its revenues by over 70% - a very strong performance that has impressed analysts.

Brad Reback of stockbrokers Stifel believes Microsoft has a bright future via the cloud:

“We continue to believe the shift to the cloud will be additive to Microsoft given a broader portfolio of products with deeper functionality as well as Microsoft’s ability to enter new categories where it did not compete previously.”

Stifel has raised its price target for Microsoft to $150, from $130.

Jasper Lawler of London Capital Group agrees, telling clients:

Cloud is clearly the way forward for Microsoft and demand for these services is expected to remain strong.

Here’s Microsoft’s top line, from last night:

  • Earnings: $1.14 per share, excluding certain items, vs. $1.00 forecast by analysts
  • Revenue: $30.6 billion vs. $29.84 billion expected

Updated

My colleague Larry Elliott says Sainsbury’s boss Mike Coupe needs to move fast to reassure the City that he has a new strategy, now his merger with Asda has been rejected.

Coupe made a catastrophic misjudgment in assuming the CMA would wave the deal through. He compounded the error by allowing himself to be filmed singing “We‘re in the Money” on the day the merger plan was announced. And judging by the fall in Sainsbury’s shares, taking them close to a 30-year low, investors don’t think there is a plan B. To shake off the sense he is past his sell-by date, Coupe needs to come up with a different song – and fast.

Better economic news from America: new orders for durable goods have jumped at their fastest rate in seven months.

Increased demand for cars, aircraft and other defence equipment drove orders up - perhaps a sign that the global economy is picking up (although these figures are volatile).

It’s been a rough decade for Sainsbury’s shareholders, as this chart show:

Sainsbury's share chart

Newsflash: The number of Americans signing on for unemployment benefit has jumped unexpectedly.

Some 230,000 new claims for jobless support were filed last week, up from just 193,000 the previous seven days.

That 37,000 increase is the biggest jump in 19 months. But don’t panic - last week’s figures were the best in almost 50 years. And in historical terms, the initial claims figure is still low.

3M rattles Wall Street

Over in New York, manufacturing conglomerate 3M has sent a shiver through the markets with some underwhelming results.

3M, which makes industrial, safety, health care and consumer goods products, cut its forecasts for profits this year. It now plans to cut 2,000 jobs as part of a restructuring programme.

The firm also missed Wall Street forecasts for sales and profits in the first quarter of 2019.

Here’s the details:

  • Earnings per share: $2.23, adjusted vs. $2.49 expected (according to Refinitiv data)
  • Revenue: $7.863 billion vs. $8.025 billion expected

CEO Mike Roman says the last three months have been disappointing - a contrast with strong results from Facebook and Microsoft this week.

“We continued to face slowing conditions in key end markets which impacted both organic growth and margins, and our operational execution also fell short of the expectations we have for ourselves.”

Here’s our profile on banker Alison Rose, a leading candidate to replace Ross McEwan as the head of Royal Bank of Scotland following his resignation today.

Sainsbury's shares flirting with 30-year low

Back in the City, there’s no respite for Sainsbury’s yet.

After a morning of heavy selling, Sainsbury shares are down 4.5% at 216p. That’s still their lowest level since July 2016, and not far from their weakest point since 1989:

Sainsbury’s share price
Sainsbury’s share price since the 1980s Photograph: Refinitiv

Amisha Chohan, retail analyst at Quilter Cheviot, says Sainsbury’s looks relatively weak, now the Asda deal is off the table:

“In our view, Sainsbury’s is the weakest UK food retailer in terms of financial performance. Although the Argos merger has been beneficial, recent general merchandising sales have been weak. We prefer Tesco; its self-help measures are starting to pay off, it has exposure to the fast growing wholesale market via Booker, and has an attractive valuation. Tesco is transforming from a recovery play into a growth play, which should warrant a re-rating.

And what for Asda? Chohan reckons it could be spun off into private equity hands....

“Whilst parent company Walmart will ensure Asda has the resources it needs to keep delivering for customers, the question remains “who could buy it now?” Morrison’s will struggle to bid for it, given its weak track record of mergers, and Tesco is unable to participate, due to its size. Private equity may be the only viable option.”

Updated

Left-wing thinktank launched

An influential group of academics supported by John McDonnell, Ed Miliband and Caroline Lucas have launched a radical thinktank to develop plans for a Green New Deal and inclusive ownership of businesses.

The new organisation, Common Wealth, is aiming to design democratic models of company ownership to curb rising levels of inequality, with close links to Labour in Britain and Bernie Sanders in the US.

Founded by Matthew Lawrence, a former researcher at the IPPR thinktank and an influential figure in leftwing circles, the policy group will design a roadmap for how a radical Green New Deal can transform the economy in the face of climate breakdown.

Lawrence was the co-author of the “inclusive ownership fund” policy proposal, adopted by the shadow chancellor last year as Labour policy, which includes the transfer 10% of the shares of big UK-listed firms to their workers over a decade.

McDonnell said he “warmly welcomed” the launch and looked forward to Common Wealth’s contributions.

Miliband, the former Labour leader, who sits on the group’s advisory board, said:

“Radical but pluralistic, their commitment to designing ownership models for a democratic and sustainable economy is urgently needed and very welcome.”

Caroline Lucas, the Green MP, said:

“They’re doing important work on democratic and sustainable ownership models that would make the economy work for people and planet.”

Shops in Buxton, Derbyshire.
Shops in Buxton, Derbyshire. Photograph: Christopher Thomond/The Guardian

Newsflash: UK retail sales have risen this month, for the first time since November 2018.

That’s according to the CBI’s latest monthly survey of the sector, which suggests shoppers are benefitting from rising wages and an easing of the Brexit crisis.

The CBI says:

The survey of 110 firms, of which 55 were retailers, showed that sales volumes rose for the first time in five months, likely supported by the later timing of Easter this year.

Indeed, sales remained above average for the time of year. Orders placed on suppliers also grew and are expected to pick up further in the month ahead, with sales volumes also set to see somewhat faster growth.

Ouch! Fashion and furnishings chain Laura Ashley have just issued a short, sharp profits warning.

It says:

Trading conditions have been very demanding over the third quarter.

The Board of the Company have reviewed the revised full year forecasts for the year ending 30 June 2019 and expect the results to be significantly below market expectations.

This comes just two months after the company’s last profits warning, which it also blamed on difficult trading conditions. It made a £1.5m loss in the first half of this year, amid falling sales.

Getting back to the Sainsbury-Asda (ex) merger.... veteran retail analyst Nick Bubb is a rare voice criticising the CMA for blocking the deal.

Bubb argues that the competition authorities should have insisted on some stores being sold off to protect customers, rather than vetoing the deal:

There is no sign of Sainsbury’s CEO, Mike Coupe, falling on his sword, after the wretched CMA decided that the Sainsbury/Asda merger should be blocked completely, perhaps because there is some sympathy for his situation, as who would have thought the CMA would be so stupid as to ignore all the arguments about price competition and not even suggest a big chunk of store disposals…

Gambling boss demands ban on gambling adverts (but why?...)

In an unexpected twist, the boss of Britain’s largest gambling firm has called for a complete ban on betting adverts during TV sports broadcasts.

Under GVC’s plan, bookmakers would be banned from broadcasting adverts on live sport, apart from horse racing. It wants competitors including Paddy Power and William Hill to back the voluntary plan (GVC won’t do it unless the others join in).

Kenny Alexander, chief executive of GVC Holdings (which owns bookmakers Ladbrokes Coral) has also decided to stop sponsoring football teams (its Betdaq operation sponsor Charlton and Sunderland), and to ditch adverts at the pitch side.

The move follows a series of chilling reports into the reckless way gambling firms have treated customers, particularly those with a betting addiction.

So has GVC (which is also pledging more support for gambling charities) seen the light?

My colleague Rob Davies suspects the company has spotted which way the wind is blowing, and trying to protect itself from tighter, mandatory regulation.

Updated

City workers were reminded about the climate change emergency this morning.

Environmental campaigners from the “Extinction Rebellion” blocked the road outside the Bank of England, and glued themselves across the entrance to the London Stock Market.

Their goal: to put more pressure on the financial industry to help stop the growth in carbon emissions.

An XR spokeswoman explained:

The financial industry is responsible for funding climate and ecological destruction and we are calling on them, the companies and the institutions that allow this to happen, to tell the truth”.

“And we’re asking the Government to take action to address the climate emergency.”

Extinction Rebellion environmental activists glue themselves to the main entrance of the London Stock Exchange on the group’s final day of direct action during day 11 of ongoing protests in London, England.
Extinction Rebellion environmental activists glued themselves to the main entrance of the London Stock Exchange. Photograph: Ollie Millington/Getty Images
Extinction Rebellion Hold Final March Ahead Of Leaving LondonLONDON, ENGLAND - APRIL 25: Envrionmental campaigners from the “Extinction Rebellion” group block the junction at Bank as part of their ongoing actions and protests across the capital on April 25, 2019 in London, England. Organisers have said demonstrators will target the financial industry as it is due to end blockades at Parliament Square and Marble Arch on the eleventh and final day. The protests have involved roadblocks, sit-ins and the halting of sections of the public transport system, in a bid to highlight environmental concerns. (Photo by Leon Neal/Getty Images)
The junction at Bank in the City of London this morning Photograph: Leon Neal/Getty Images

I don’t know if Mark Carney could see them from his office window. But if so, the governor may have felt some solidarity with XR. Carney has repeatedly warned that climate change is an urgent issue, and that some companies and industries will be swept aside if they don’t take it seriously.

Deutsche-Commerzbank merger talks fail

More banking news! Deutsche Bank’s attempts to merge with German rival Commerzbank have collapsed.

Deutsche Bank has just announced that negotiations to combine the two German lenders have ended without a deal.

It says:

After thorough analysis, we have concluded that this transaction would not have created sufficient benefits to offset the additional execution risks, restructuring costs and capital requirements associated with such a large-scale integration.

The talks appear to have hit several rocks, including lukewarm support from investors and strong opposition from labour unions.

Both banks have been struggling with weak profitability and the overhang from bad debts. They could now be vulnerable to a takeover from overseas rivals.

It’s also been a busy morning for UK banking.

Ross McEwan has resigned from Royal Bank of Scotland, after more than five years dragging the taxpayer-owned bank back to profitability (and plenty of criticism over his pay).

His deputy, the well-regarded Alison Rose, is seen as a top candidate to replace him.

Rival bank Barclays has posted a 10% drop in profits, and revealed that its investment bankers have seen their bonuses shrivel accordingly.

Britain’s suppliers will also be cheering the demise of the Sainsbury-Asda merger, says Mark Jones, partner at law firm Gordons.

He predicts they’d have been squeezed hard if the new supermarket giant had been waved through:

The CMA said the risk was that customers would face higher prices. Maybe that is true but in the short term, suppliers would have been told that they have to supply the combined business at the lower of the two prices they charge Asda or Sainsbury’s, or possibly provide a new even lower price. That would have been the immediate effect of the merger and, thankfully for suppliers, the CMA has done them a favour.”

Now that they can’t merge, Sainsbury’s and Asda may be forced into a new price war.

So argues Ratula Chakraborty, professor of business management at UEA’s Norwich Business School:

“UK shoppers should rejoice at the CMA’s decision to block the proposed merger between Sainsbury’s and Asda. This merger would have reduced competition, resulting in higher prices and less choice. Consumers can now expect the supermarket wars to resume with full force, as the retailers now know that they cannot avoid competition by hiding behind anti-competitive alliances and tie-ups.

“The CMA decision has ensured that the only way to win in this market is by competing head-to-head to give consumers genuine better value for money rather than have giant monopolies stitching up the market and pretending to compete through illusory marketing gimmicks.

“Serious questions must be asked about the folly of the senior management of Sainsbury’s and Asda to pursue a merger that had no chance of being approved by the CMA. Shareholders should be very angry at the time and money wasted on this hopeless venture.

Sainsbury’s long-term share price chart is a chilling sight this morning.

At just 214p (-5% today), its shares are on track to close at their lowest point since 1989!

That’s an astonishing failure, given the wider FTSE 100 has more than tripled over the same period.

Back in 2007, Sainsbury’s shares were trading at a chunky £6, but have struggled over the last decade.

Sainsbury’s share price
Sainsbury’s share price Photograph: Refinitiv

Updated

Hardly anyone has a good word to say about the Sainsbury-Asda merger, as it shuffles off into retail history.

Here’s Rebecca Long Bailey, Labour’s Shadow Business Secretary:

“The CMA’s decision is welcome and validates the concerns of many trade unions and industry groups that the merger risked stifling choice and quality in the groceries sector, as well as driving down terms for workers and supply chain businesses.”

Despite that criticism, Clive Black isn’t in the “Mike Coupe must go” camp.

He writes:

Mr Coupe was bold in seeking this merger and should be praised for this ambition and idea generation.

Instead, Black blames Sainsbury’s directors for not providing an “arm round the shoulder” for their CEO, who is now facing a lot of flack.

Analyst: Supermarket bosses guilty of arrogance and naivety

Retail analyst Clive Black of Shore Capital has issued a stinging rebuke to the top management of Sainsbury and Asda for attempting to get their merger through.

He accuses both firms of “arrogance and naivety”, for assuming that the competition authorities would roll over, just because they allowed Tesco to take control of wholesale business Booker recently.

Black writes:

There was a considerable sense of irony that the CMA announced its final decision on the proposed Sainsbury-Asda merger ahead of its self-imposed deadline of the 30th April. That irony emerges from the fact that Sainsbury and Asda took the CMA to the Competition Appeals Tribunal (CAT) to argue that there was the need for more time to consider a deal where the players felt that they knew the rules better than the referee.

Well, the referee has now blown the whistle on a deal that we give credit to its architect(s) for being bold but were set against a strategy and tactics that were most certainly not of a mould of the likes of Sir Alex Ferguson. Indeed, arrogance and naivety are words that come to mind when considering this proposed amalgamation from start to finish.

Chiding Coupe and co for a lack of “rationality and perspective”, Black concludes:

At the heart of the proposed deal’s problems is an incorrect and over-extrapolation of the decision by the CMA, under a different managerial regime, to unconditionally clear the Tesco-Booker merger. We felt at the time that it was a surprising and poor decision. However, rather than analysing matters with a sense of rationality and perspective, Sainsbury and Asda seem to have decided that 1+1 can equal 10.

The GMB union, which represents many Asda workers, says staff have suffered months of uncertainty thanks to the Sainsbury deal -- management now need to give them proper support.

Sainsbury’s shares have sunk to the bottom of the FTSE 100 leaderboard.

They’re now down 6% at 220p, which is still a 33-month low.

Connor Campbell of City firm SpreadEx says:

In a move that manages to be both shocking and unsurprising, the Competition and Markets Authority brought the game-changing Sainsbury’s/Asda merger to a screeching halt on Wednesday, stating that it had no other option but to block the deal in the face of what it described as ‘a poorer shopping experience’ for all of the supermarkets’ UK shoppers.

Sainsbury’s – which has already had a tough start to 2019 due to speculation that the CMA wasn’t happy about the potential tie-up – slid more than 6% on the back of the news, a decline that could worsen as the day goes on. It also leaves the supermarket barely hovering above £2.10, and means next week’s full year results are going to make for interesting reading.

If you’re just tuning in, here’s Zoe Wood’s news story on the sinking of Sainsbury’s merger with Asda:

The unions are also applauding the end of “Sasda”.

Unite national officer Bev Clarkson says Sainsbury’s workers will be particularly relieved.

“The merger and possibility of store closures and job losses as a result has been unsettling, causing great uncertainty at a time when the supermarket imposed changes to contracts that has left many workers out of pocket.

“Staff will now look to senior management to give them certainty so they can concentrate on serving customers.”

Which? welcomes CMA ruling

Caroline Normand, director of advocacy at consumer group Which?, says the CMA was quite right to slam the brakes on the deal:

“The CMA is right to block this merger, which could have reduced competition in the sector resulting in a number of problems for shoppers including increased prices, reduced quality and choice, and a poorer shopping experience.

She also points out that both companies are struggling, compared to the faster-growing discount chains:

“Sainsbury’s and Asda have fallen behind the pack recently in this trusted sector – with both finishing in the bottom four of our annual supermarket survey as rivals like Aldi and Lidl have done a better job of giving shoppers what they want.”

Green Party MEP Molly Scott Cato is pleased that Sainsbury and Asda aren’t merging, as it would have created even more pressure on suppliers.

Sainsbury's shares slide

Sainsbury’s shares have slumped to their lowest level since the summer of 2016, as trading begins in London.

Shares have fallen by over 5%, as investors react to the termination of its merger with Asda. That takes them down to 214p, from 226p last night.

Sainsbury’s share price
Sainsbury’s share price this week Photograph: Refinitiv

As you can see here, Sainsbury’s share surged last April when the deal was announced, but have been under pressure more recently.

Sainsbury’s share price
And on a longer view.... Photograph: Refinitiv

City brokers Jefferies have slashed their price target for Sainsbury’s to 200p, from 230p, so the shares could come under further pressure today....

Updated

Mike Coupe, the CEO of Sainsbury’s
Mike Coupe, the CEO of Sainsbury’s Photograph: Toby Melville/Reuters

City analysts are also speculating that Mike Coupe’s position at Sainsbury’s looks precarious, now his big deal with Asda is in ruins.

Tom Stevenson, investment director at Fidelity, says the CMA’s ruling is a personal blow:

“Confirmation that the competition watchdog has blocked Sainsbury’s planned merger with Walmart-owned Asda will surprise no-one after its forthright interim report in March made clear its deep reservations about the deal.

Mike Coupe, Sainsbury’s chastened boss, will put a brave face on things as he announces results next week but this is a blow to his reputation and the company’s prospects.

Neil Wilson of Markets.com also believes Coupe could be heading to the checkout.

Mike Coupe remains absurdly disingenuous. “The specific reason for wanting to merge was to lower prices for customers,” he said today in reply. No one, least of all the CMA, fell for it. Will Coupe stay? I doubt it, this could well be the time for Coupe to exit.

The real worry for Sainsbo’s is what now? Sainsbury’s is the squeezed middle, losing market share to discounters and simultaneously losing out to more premium brands. While Aldi and Lidl consistently gain market share and Tesco rebounds, Sainsbury’s is feeling the pinch. The worry is that it had no credible plan except this merger.

Late last year, Sainsbury’s reported that it had spent £17m on costs related to the Asda deal.

Retail analyst Steve Dresser points out that the final bill will be higher - money that could have been spent on store improvements or price cuts.

Although the Asda-Sainsbury merger has failed, it wasn’t entirely a wasted effort.

It did provide us with one of the classic CEO gaffes of recent years, when Mike Coupe was caught on camera singing “We’re In The Money” on the day the deal was announced.

That rather undermined his claim to be motivated by what was best for customers....

Updated

Sainsbury’s CEO Mike Coupe must now be feeling the heat after pursuing the ADSA deal so firmly, only to be thwarted by the CMA.

Professor John Colley of Warwick Business School points out that the whole process has been disruptive.

“This is good news for customers. Sainsbury’s CEO Mike Coupe may have promised he would pass on £1bn of savings to customers over three years, but that figure was never verifiable nor credible.

“Prices move up and down all the time. Over three years it would have been impossible to assess what prices would have been without the merger.

“Allowing two chains - Tesco and Asda-Sainsbury’s – to share almost 60 per cent of the market would have resulted in less choice and competition, creating the risk of higher prices.

“The major beneficiaries of this merger would have been the Asda-Sainsbury’s shareholders.

“Mr Coupe will now be under some pressure from those shareholders as the abortive bid will have been very expensive in advisor fees and an immense distraction for senior management.

Graham Hiscott of the Daily Mirror agrees that Coupe is under fire.

ASDA’s parent company, Walmart, has also expressed disappointment at the move. So what happens now?

CEO Judith McKenna says Walmart’s focus is to “continuing to position Asda as a strong UK retailer delivering for customers”, adding

Walmart will ensure Asda has the resources it needs to achieve that.

There has been speculation that Asda could be sold off, perhaps to a private equity firm... but McKenna’s comments suggest Walmart will keep it.

Roger Burnley, CEO of Asda, says he’s disappointed with today’s ruling.

He also acknowledges that the merger has worried many Asda staff, who could have lost their jobs if the merger had gone through, saying:

We’re disappointed with their findings but will continue to find ways to put money back into customers’ pockets and deliver great quality and service in an ever changing and demanding market.

I have always been hugely aware that the last year has been an unsettling time for all of our colleagues and am immensely grateful for their commitment and dedication during that time. Our focus is now on the most important job we all have – delivering for our customers.”

Sainsbury: The deal's off!

Sainsbury has confirmed that its £7bn takeover of Asda is now dead.

CEO Mike Coupe (for whom today’s ruling is a bitter blow) says the two companies have agreed to terminate the transation.

Coupe also savages the competition watchdog, saying its reasoning is faulty:

“The specific reason for wanting to merge was to lower prices for customers. The CMA’s conclusion that we would increase prices post-merger ignores the dynamic and highly competitive nature of the UK grocery market. The CMA is today effectively taking £1 billion out of customers’ pockets.

“Sainsbury’s is a great business and I am confident in our strategy. We are focused on offering our customers great quality, value and service and making shopping with us as convenient as possible.”

SAINSBURY-ASDA MERGER BLOCKED

Good morning.

Attempts to create Britain’s largest supermarket group have been crushed by competition authorities this morning.

Sainsbury and Asda have been told that their merger, announced last year, cannot go ahead as it would simply be bad news for consumer.

In a scathing judgement, just released, the Competitions and Markets Authority ruled that combining the two firms would have led to higher prices, lower quality, a worse range on the shelves, and a poorer overall shopping experience.

The CMA also concluded that online shoppers would also suffer from higher prices and reduced quality of service.

Motorists could also get stung, paying more for fuel at over 125 locations where Sainsbury’s and Asda petrol stations are located close together.

Stuart McIntosh, chair of the inquiry group, declares:

It’s our responsibility to protect the millions of people who shop at Sainsbury’s and Asda every week. Following our in-depth investigation, we have found this deal would lead to increased prices, reduced quality and choice of products, or a poorer shopping experience for all of their UK shoppers.

We have concluded that there is no effective way of addressing our concerns, other than to block the merger.

That’s a blow for both companies, particularly Sainsbury (the UK’s second-largest supermarket chain) which has been losing market share in recent months in the ever-competitive retail sector.

Sainsbury had driven the now-defunct merger through a £7bn takeover of Asda, number 3 in the market and owned by Walmart.

Reaction to follow!

Also coming up today, we get a new health check on UK retailers, and America’s factories:

The agenda

  • 11am BST: CBI retail trends report
  • 1.30pm BST: US durable goods orders

Updated

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