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CMA has provisionally found that JD Sports’ takeover of Footasylum not good

Christian Fernsby ▼ | February 11, 2020
After its initial Phase 1 review raised potential competition concerns, the Competition and Markets Authority’s (CMA) in depth Phase 2 investigation has provisionally found that the deal substantially lessens competition nationally.
JD Sports
Business in Britain   JD Sports
The CMA is concerned that the loss of competition from the merger could mean that shoppers see fewer discounts, for example from clearance sales and Black Friday promotions, or receive a lower quality of customer service.

Topics: CMA JD Sports takeover Footasylum

It could also lead to less choice in stores and online.

JD Sports and Footasylum both sell sports inspired casual clothing and footwear in stores across the UK and online through their websites.

The £90 million deal was announced and completed last year.

The sportswear sector is growing.

In 2018 UK consumers spent more than £5 billion on sports clothing and footwear, and sportswear has become increasingly fashionable, particularly amongst young people.

While JD Sports is the largest retailer in this market with around 375 stores nationally and Footasylum is smaller, the CMA’s detailed investigation has provisionally found that they compete closely, and surveyed customers indicated that there are only a small number of other retailers that they would consider buying from.

In reaching this provisional decision, the CMA looked at a large volume of evidence.

This included data from 2 surveys of more than 10,000 JD Sports and Footasylum customers, documents from the companies, their competitors and suppliers and financial information from both of the merging businesses.