Watchdog warns Morrisons takeover could trigger higher prices at 121 petrol stations

Competition officials have warned that private equity firm Clayton, Dubilier & Rice’s £7 billion takeover of supermarket chain Morrisons could lead to higher fuel prices in more than 120 locations.

In January, the Competition and Markets Authority (CMA) launched a probe into the deal but it has now said it could pursue a deeper investigation if these concerns are not addressed.

The private equity firm, which also owns petrol station giant Motor Fuel Group (MFG), won a lengthy auction to buy the Bradford-based retailer in October.

MFG operates 921 petrol stations across England, Scotland and Wales under a number of different brands, while Morrisons runs 339 petrol stations at its supermarkets.

Morrisons is the fourth largest supermarket operator in the UK. Picture: Mikael Buck/Morrisons

The competition regulator said it now has concerns over 121 local areas where MFG and Morrisons both have forecourts and would face “limited competition” from other players following the deal.

The warning comes after a recent surge in the price of petrol and diesel across Britain’s forecourts.

Colin Raftery, senior director of mergers at the CMA, said: “Prices for petrol and diesel have recently hit record highs, which makes it even more important that we don’t allow a lack of competition at the pump to make the situation worse.

“We’re concerned that this deal could lead to higher prices for motorists in some parts of the country.

“But if CD&R and Morrisons are able to address these concerns, then we won’t need to move on to an in-depth investigation of the merger.”

Supermarket rival Asda agreed to sell 27 petrol stations last year in order to help its £6.8bn takeover pass following concerns from the CMA.

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