2020欧洲杯网站

JD Sports threatens legal action after watchdog blocks Footasylum deal

2020欧洲杯网站 The Competition and Markets Authority said the deal would 'lead to a substantial lessening of competition'

JD Sports has threatened to take the competition watchdog to court after it torpedoed the takeover of smaller rival Footasylum. 

2020欧洲杯网站The firm vowed to take action after the Competition and Markets Authority (CMA) blocked its £90m acquisition of Footasylum more than a year after the deal was first agreed.

JD has been ordered to offload the business to an alternative buyer of which regulators approve, throwing Footasylum's future into doubt and meaning it could potentially be forced to shut.

2020欧洲杯网站Peter Cowgillm boss of JD, said: "We fundamentally disagree with the CMA's decision, which continues to rely on an inaccurate and outdated analysis of the UK sports retail competitive landscape, and is underpinned by outdated and flawed customer surveys."

The CMA said there would be a significant hit to competition if it waved through the tie-up between the pair, which were founded by different generations of the same family.

2020欧洲杯网站It added that consumers could be left with fewer discounts and lower quality service as a result.

The decision was met with fury from JD, which said the watchdog did not understand the sports retail market and labelled the move "absurd". 

2020欧洲杯网站The group also took a swipe at the "the self-serving testimony" of rival Mike Ashley's chain Sports Direct for vocally opposing the deal. 

2020欧洲杯网站Peter Cowgill, executive chairman of JD Sports, said he would now consider whether to take the CMA to court to challenge its decision. 

Kip Meek, of the CMA, said: "Our investigation analysed a large body of evidence that shows JD Sports and Footasylum are close competitors.

"This deal would mean the removal of a direct competitor from the market, leaving customers worse off. Based on the evidence we have seen, blocking the deal is the only way to ensure they are protected."

As an independent business Footasylum issued a string of profit warnings - and since then the coronavirus pandemic has brought further pain to Britain's already ailing high street, forcing stores to shut.

Household names such as Laura Ashley, Cath Kidston and Debenhams have already gone into administration, with analysts expecting more outlets to follow in the coming months. 

2020欧洲杯网站JD Sports believes that coronavirus has piled even more pressure on Footasylum, and fears the company could fold without its support.

2020欧洲杯网站It said: "We must face the fact that there is a significant probability that a prospective purchaser could look to substantially reduce Footasylum’s central operations, resulting in a considerable loss of jobs."

Any closures would hit particularly hard in the north West where Rochdale-based Footasylum is headquartered, it said.

The watchdog said that although the crisis has led to uncertain and challenging trading conditions for retailers, its competition jitters have not been removed by the impact of coronavirus. 

Pippa Stephens, a retail analyst at GlobalData, said: "The footwear specialist may not prove to be strong enough to stand on its own two feet in the future, given the impact of Covid-19." 

The CMA has taken an increasingly hardline approach to mergers under chairman Lord Tyrie, a crusading former Tory MP who chaired the Treasury select committee in the wake of the financial crisis.

Its latest action will help dispel claims the regulator has taken a lighter-touch approach since the pandemic stuck, after bosses waved through tie-ups between takeaway firm Deliveroo and Amazon, as well as Justeat and Takeaway.com.

 

2020欧洲杯网站Barry Brown, Footasylum’s executive chairman, was chief executive of JD for almost 15 years after initially joining in 1983 as a store manager. 

The smaller retailer was set up as a single shop in Cheshire in 2005 by David Makin, who co-founded JD with his business partner John Wardle in 1981.

2020欧洲杯网站Its chief executive, Clare Nesbitt, is Mr Makin's daughter.

Footasylum runs more than 50 branches in the UK and employs about 2,500 staff. It is popular with students. 

2020欧洲杯网站Shares in JD Sports rose 0.6pc to 508p. The stock was trading above 870p before the pandemic hit.