The OFT would immediately refer an Asda bid for Somerfield to the Competition Commission, according to an industry analyst, following speculation that the number two supermarket retailer is eyeing up its smaller rival.
Head of equities at Seymour Pierce Richard Ratner said that it was highly unlikely Asda would be allowed to buy the chain. He suggested that if Asda had hired investment bank Lazard to put together an offer, as reports suggest, the ulterior motive would be to force the OFT’s hand.
Ratner explained: “Asda probably wants the bid to be referred to the OFT - if it is banned from making an offer, then it would scupper any future c-store acquisition activity by Tesco and Sainsbury.”
But should the speculation prove accurate and Asda does put in an offer, Ratner said that the supermarket could be making a mistake.
He said: “They are not used to operating in the smaller stores and when Wal-Mart tried it in Germany, they made a mess of it. It may be Asda wants a few stores for George, but it’s an expensive way of going about it - they don’t need to buy the whole thing for that.”

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