Poundland has confirmed it will proceed with its planned takeover of rival 99p Stores despite facing an investigation from the Competition and Markets Authority (CMA).
Both chains have exploded in recent years, so a takeover seemed like a monumental move for Poundland. But the regulator had raised concerns that the tie-up could have a negative impact on consumers in the areas where the two chains overlap, and asked Poundland to offer 'undertakings' to make sure that didn't happen.
Poundland declined, and even threatened to walk away if the CMA was too insistent - perhaps hoping the regulator would back off. But today it seems to have had a change of heart, announcing that it plans to work with the regulator as it carries out a rather bureaucratic sounding 'Phase II review', which could drag on for six months and could force Poundland to make concessions if it wants the deal to go ahead. Poundland said it's still confident the tie-up would be a good deal for both shareholders and customers.
'We look forward to working with the CMA in Phase II in order to ensure that we can deliver an improvement in choice, value and service for 99p Stores' customers,' said Poundland's chief exec Jim McCarthy (who is profiled in next month's MT).
That's likely to have been spoken through gritted teeth though, as the CMA's investigation is a major nuisance for the retailer's plan to build a 1,000 store giant.