The Association of News Retailing and the National Federation of Retail Newsagents have vowed to keep up the pressure on the Office of Fair Trading to refer newstrade distribution to the Competition Commission after Dawson News this week slipped into administration.

Dawson Holdings placed Surridge Dawson and Solent SD which trade as Dawson News into administration on Monday after it had lost a string of major contracts worth £463m in the past year. Dawson's 20 depots were promptly snapped up by Smiths News for £1.5m, while Menzies Distribution picked up assets worth £500,000.

ANR chief John Lennon said the body had already made a submission to the OFT's mergers department on Smiths' acquisition.

"It's probably too late to stop the deal but the OFT should look into the wider market structure of newstrade wholesaling," he said. "Distribution is now split between two wholesalers with huge regional monopolies, which is not healthy."

The NFRN has also met with the OFT to discuss its concerns. "They have taken note of what we said and seem to have a good grasp of the issues," said trade relations head David Daniel.

Meanwhile, Dawson's administrator said retailers' would not be left out of pocket. Contracts have migrated to either Smiths or Menzies and retailers would receive full credit for unsold copies returned via their new wholesaler.

Smiths' purchase saved 1,800 Dawson workers from redundancy, although its Warrington and Heywood depots will close. Smiths could not confirm if further closures were imminent.