JD Sports responds to CMA Footasylum deal probe

JD Sports has insisted that its £90 million takeover of shoe retailer Footasylum would not negatively affect competition after the Competition and Markets Authority (CMA) announced its decision to launch a full review into the deal.

The CMA announced on 19 September that an initial enquiry that the merger may be expected to “result in a substantial lessening of competition”.

The acquisition, which was agreed in March this year, would see JD Sports take on 70 Footasylum stores in the UK, as well as the brand’s online and multi-channel operations.

The watchdog said in September that it would need to progress its review of the takeover to a phase 2 investigation unless both parties were able to offer acceptable undertakings to address the concerns raised about the impact on competition.

Today, a statement posted by the CMA announced that it has referred the completed acquisition for an in-depth investigation.

JD Sports released a statement outlining its response, insisting that it “firmly believes that there is clear evidence that the acquisition would not result in a substantial lessening of competition in the relevant clothing and footwear retail markets where the two businesses operate”.

The statement continued: “JD has, and will, continue to co-operate fully with the CMA in its review to firmly establish that both JD and Footasylum operate in an extremely competitive and dynamic retail market and that they will continue to face strong competition following the acquisition.”

Peter Cowgill, executive chairman of JD Sports, commented: “This transaction will not result in any price increases or a reduction in product ranges or service quality. The focus of all of our group businesses is to ensure we deliver a best in class, multi-channel experience to our consumers by offering a compelling product proposition.”

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