UK retailer Poundland, which operates the Dealz franchise in Ireland and Spain, has been provisionally cleared by the UK Competition and Markets Authority (CMA) to take over its rival, 99p Stores.
In its ruling, the CMA concluded that ‘the merger may not be expected to result in a substantial lessening of competition’ and cleared the proposed deal.
"We welcome the CMA's provisional clearance of our acquisition of 99p Stores, and we look forward to a satisfactory conclusion to its Phase 2 review,” said Jim McCarthy, chief executive of Poundland. “We continue to believe that the acquisition of 99p will be great for customers and for shareholders alike."
A further consultation period will now take place, before the final judgment on the proposed deal is made.
Commenting on the announcement, Darren Shirley of Shore Capital said that the deal will “materially accelerate Poundland’s growth in Southern England and retail parks, with 99p Stores operating from c120 stores in Southern England and the 27 larger store estate outlined above.”
He said that Shore Capital believes that “Poundland remains on track to organically open 60 net new stores in the UK and Ireland in FY2016, with 40 net openings by the end of H1, ahead of the important Q3 trading period.”
© 2015 – Checkout Magazine by Stephen Wynne-Jones