Poundland gets go-ahead to buy rival 99p Stores

Poundland is set to complete its £55 million takeover of rival 99p Stores. Picture: PA

Poundland yesterday said it would complete its £55 million takeover of rival 99p Stores by the end of this month after it received formal clearance from competition authorities.

The firm had faced an in-depth probe by the Competition and Markets Authority (CMA), which might have meant it having to sell off a clutch of outlets.

The CMA had initially been concerned about the lessening of competition in 80 areas of the UK after the merger between Poundland and its biggest rival.

But it has now ditched its worries about the deal after agreeing that competition will be provided by big supermarket chains Tesco and Asda – as well as the likes of rivals Poundworld and B&M.

The planned merger, announced in February, will create a network of some 800 shops.

It was provisionally given the green light by the CMA last month and has now received formal final clearance.

The regulator said yesterday: “The CMA has concluded that the merger may not be expected to result in a substantial lessening of competition.

“Consequently, customers would not face a reduction in choice, value or quality of service as a result of the merger.

“The CMA found that, along with Poundworld, the companies are each other’s closest competitors, but after the merger they will still face competition from other value retailers such as B&M, Home Bargains, Wilko and Bargain Buys, along with Tesco and, to an extent, Asda.”

Poundland chief executive Jim McCarthy said in a statement: “We welcome the CMA’s decision to clear the merger.

“We believe that the acquisition of 99p Stores will be great for both customers and for shareholders and we will now move to completion by the end of the month.”