A warning has been issued by the UK competition regulator that petrol prices could skyrocket at over 100 Morrisons forecourts.
This is due to the fact that private equity firm Clayton, Dubilier & Rice (CD&R) are taking over the supermarket in a £7 billion deal. In January the Competition and Markets Authority launched an investigation into the takeover, but has now said it could launch a deeper investigation if concerns over potentially high petrol prices are not addressed.
It comes as CD&R also owns petrol station giant Motor Fuel Group (MFG), and won a lengthy auction to buy Morrisons in October. MFG operates 921 petrol stations across England, Scotland and Wales under a number of different brands. Meanwhile, Morrisons runs 339 petrol stations at its supermarkets.
READ MORE:
The regulator said it now has concerns over 121 local areas where MFG and Morrisons both have forecourts and would face “limited competition” from other players following the merger.
It said “the deal could lead to an increase in prices” due to the lack of competition. The warning comes after a recent surge in the price of petrol and diesel. Figures from data firm Experian Catalist show the average cost of a litre of petrol at UK forecourts on Tuesday was 167.3p, while diesel was 179.7p
What do you think of this? Have your say in the comments below.
Colin Raftery, senior director of mergers at the CMA, said: “Prices for petrol and diesel have recently hit record highs, which makes it even more important that we don’t allow a lack of competition at the pump to make the situation worse.
“We’re concerned that this deal could lead to higher prices for motorists in some parts of the country. But if CD&R and Morrisons are able to address these concerns, then we won’t need to move on to an in-depth investigation of the merger.”
Supermarket rival Asda agreed to sell 27 petrol stations last year in order to help its £6.8 billion takeover pass following concerns from the competition regulator.
Don't miss out on the latest headlines and more. Sign up to our newsletters here.
