The competition watchdog has raised concerns over Vision Express' planned takeover of Tesco Opticians, saying today the move could negatively impact customers in three local areas.
Tesco had planned to ship off more than 200 optician practices to Vision Express. Vision Express, owned by optical retail giant Grand Vision, would have 598 shops across the UK if the deal went through.
But the Competition and Markets Authority (CMA) has been carrying out a phase one investigation into the merger, looking at more than 200 areas where both firms have stores.
It said three local areas would not have sufficient competition after the merger, which could result in price increases or a decrease in the quality or choice of the products and services available in store.
These are Barrow-in-Furness in Cumbria, Helston in Cornwall, and Ryde on the Isle of Wight.
Adam Land, CMA senior director and decision maker for the case, said:
Opticians provide a vital service for millions of people in the UK and it is therefore important that any competition concerns are addressed.
In this case, we have looked carefully where Vision Express and Tesco Opticians compete at present and identified three areas of the country where we believe this merger could result in a worse deal for eye care customers.
Vision Express now has the opportunity to offer proposals to address the competition concerns flagged by the CMA.
If they aren't deemed sufficient, the merger will be referred onto a more in-depth investigation.
Vision Express' chief executive Jonathan Lawson said in a statement:
We are happy the CMA will consider proposals to resolve the competition concerns it has identified in areas where Vision Express is acquiring Tesco Optician stores. Vision Express is committed to providing suitable remedies to the CMA in order to avoid the acquisition being referred to a phase two investigation, which would prolong uncertainty for all involved.
We are now working on undertakings to allow the CMA to clear the acquisition so we can move forward with integrating Tesco Opticians into our estate.
In the proposed deal, with the supermarket giant looking to simplify its business model, all 1,500 jobs at Tesco Opticians would move across to Vision Express after a consultation process.