The Competition & Markets Authority has accepted a request by Associated British Foods and Hovis to skip the exploratory phase of its inquiry into the Hovis-Kingsmill merger, and go directly to an in-depth investigation.
The announcement came the same morning as ABF warned of lower profits than expected in an unscheduled trading update, as European Primark sales sank year on year.
“We have accepted ABF and Hovis’ request to fast-track our investigation into their merger to an in-depth phase 2 inquiry, allowing the CMA to move at pace to an examination of the evidence by an independent inquiry group of experts,” said a spokeswoman for the CMA this morning.
The CMA will now have until 24 June 2026 to reach a decision, with the members of the independent inquiry group to be announced shortly.
The move will substantially speed up the CMA’s investigation of ABF’s purchase of Hovis, and any subsequent completion of the sale.
The deadline for the CMA’s phase 1 investigation, begun in mid-December, had originally been on 19 February, with the decision to jump straight to phase 2 potentially bringing the conclusion forward by as much as six weeks.
The request to fast-track did not mean ABF or Hovis have conceded that the merger could reduce competition in the market, the CMA spokeswoman added.
“Today’s step does not involve formal findings on any competition issues, and we will carry forward evidence gathered to date, with opportunities for further engagement and consultation during phase 2,” she said.
ABF this morning revealed a challenging end to the 2025 calendar year, with sales at Primark lower than expected and its food business experiencing “mixed trading”, according to CEO George Weston, commenting alongside an unscheduled trading update.
Warning that full-year profits would fall below previous expectations, ABF told of a 5.7% drop in sales Primark’s European business, which makes up 49% of total sales, in the 16 weeks to 3 January.
The company’s food business had tougher trading than expected too, with the impact on cooking oils and bakery ingredients “more acute than anticipated”, ABF said, alongside expected weaknesses in US grocery sales.
”As a result, we now expect both our grocery and ingredients segments to deliver adjusted operating profit for the full year that is moderately below last year,” the update read. “In grocery, the effect of phasing means the impact will be more significant in the first half of the year.”
Shares in ABF opened more than 10% down this morning on the back of the profits warning.
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