Sainsbury’s and Walmart’s upscale “salmon” retailer, Asda, to merge

William Stoichevski

Asda’s popular, upscale salmon offering to find broader online audience after Sainsbury merger

UK supermarket giant, Sainsbury’s, and online grocer, Asda, a Walmart business, have announced a merger expected to give one an online helping hand and the other overnight size.

Walmart, which said late Sunday that would eventually book a USD 2 billion loss for the deal, said the combination of its wholly owned, more-upscale subsidiary, Asda, and heavyweight, Sainsbury’s, will give it 42 percent of the new entity and 29.9 percent, plus voting rights, in the Sainsbury’s.

“At a time of significant and rapid change in the retail sector, the Combination will create one of the UK’s leading grocery, general merchandise and clothing retail groups,” a Walmart statement said.

“Bringing together two distinctive customer propositions will create a more competitive, adaptable and resilient business,” the Arkansas-based retailer stated.

“Salmon retailer”
Asda’s reputation as an upscale, fresh-produce grocer was partly earned by offering a range of fresh and prepared salmon products. The company’s suppliers were known to adhere to no new fewer than four salmon-farming certifications.

Walmart also said approval for the deal wouldn’t likely come from competition regulators until late-2019. Asda, it said, would still be run from Leeds but that its CEO would join a new group board in the new entity that will have combined revenues of GBP 51 billion.

Lower UK salmon prices?
One of online retailer Amazon’s moves after picking up Whole Foods Markets in August 2017 was to lower prices, including salmon prices.

“It is expected that value will be passed on to customers through significant price reductions,” a Walmart statement said about the Sainsbury-Asda merger.

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The combined company will be able to boast 2,800 stores and “47 million customer transactions per week.

“The (merger) will bring together two of the most experienced and talented management teams in retail at a time when the industry is undergoing rapid change. We welcome Walmart as a significant shareholder and look forward to working closely with them,” stated David Tyler, Chairman of Sainsbury’s.