The UK’s Competition and Markets Authority (CMA) has approved the merger between logistics providers GXO and Wincanton, subject to the sale of Wincanton’s dedicated grocery warehousing business to a CMA-approved buyer.
According to the CMA’s final report, published on June 19, GXO’s acquisition of Wincanton would “reduce competition in the supply of dedicated warehousing services to grocery customers in the UK”.
As a result, GXO agreed to sell Wincanton’s dedicated grocery warehousing business and the inquiry group was satisfied this would sufficiently address its competition concerns, enabling it to clear the deal.
Richard Feasey, chair of the independent inquiry group, said, “Warehousing services play a crucial role in ensuring the seamless movement of goods across the UK, allowing our supermarkets to maintain well-stocked shelves with thousands of items we buy every day.
“Healthy competition in this market is key to managing costs for supermarkets and grocers and improving their performance – ultimately ensuring consumers pay the best possible prices for products in stores. We are pleased to approve this deal, having worked with GXO and Wincanton to secure the necessary changes to the deal which resolve our concerns.”
According to GXO, integration of Wincanton into its business is expected to commence in the third quarter and the teams are permitted to collaborate on specified ongoing aerospace and defense tenders in the UK effective immediately. No further regulatory reviews are required.
Malcolm Wilson, chief executive officer of GXO, confirmed, “We are pleased to have the UK regulatory review concluded and are excited to bring the two businesses together. The combination of GXO and Wincanton will enhance GXO’s offering for customers across the UK and Ireland and bring presence in strategic verticals that will serve as a springboard for growth. We are well positioned to move forward swiftly and look forward to welcoming the Wincanton team to GXO.”