Nisa boss Nick Read has argued that Tesco’s proposed takeover of wholesaler Booker will cause an “enormous amount of pain” as well as some opportunities.
Speaking at Nisa’s annual trade show, Read said he would be “churlish” to say the proposed merger would not be a threat to Nisa, as it is set to increase Booker’s buying power.
But, according to Talking Retail, Read also described how its rival’s £3.7bn deal could provide some benefits to Nisa.
Read said he expects the merger to face full phase two scrutiny by the UK competition authorities and cause ”enormous disruption over the next 18 months”.
He said that Budgens and Londis, which have already gone through the “pain” of being acquired by Booker, might be inclined to switch fascias rather than face renewed upheaval, and argued that the task of combining two different business cultures at Tesco and Booker would “take people’s eye off the ball”.
“I think there’s going to be an enormous amount of pain and consequently quite a bit of fallout,” the chief executive said.
A silver lining?
Read added that if Booker or Tesco were forced to sell off some c-stores, this would offer Nisa, which supplies 3,466 shops within its member-owned network, the opportunity to grow its store portfolio or pick up supply contracts to groups of stores.
“We do see opportunities that will present themselves, and professionalising our recruitment team is a way of exploiting that.”
The proposed merger has divided opinion.
Last month, Schroders and Artisan, two of Tesco’s largest shareholders, wrote to the retailer’s board urging them to abandon their plans.
But Tesco boss Dave Lewis insisted the grocer remains “completely committed” to the acquisition.
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