Sainsbury’s has confirmed that it is merging with Walmart’s Asda, creating the UK’s biggest supermarket group.

In an announcement this morning (30 April), Sainsbury’s said bringing together the two businesses, which between them had revenues of £515bn in 2017, will result in a more “competitive and resilient” business that will be better able to invest in price, quality, range and the technology to create more flexible ways for customers to shop.

The shock deal between the UK’s second and third largest supermarkets creates a combined network of more than 2,800 Sainsbury’s, Asda and Argos stores. This equates to around a 31% share of the supermarket sector, ahead of current market leader Tesco on 28%, according to Kantar Worldpanel figures.

Both the Sainsbury’s and Asda brands will be maintained and will operate as a “dual-brand strategy” in an effort to “sharpen their distinctive customer propositions and attract new customers”. Sainsbury’s says it also aims to lower prices by around 10% on everyday essentials.

“This is a transformational opportunity to create a new force in UK retail, which will be more competitive and give customers more of what they want now and in the future,” says Sainsbury’s chief executive officer, Mike Coupe.

“It will create a business that is more dynamic, more adaptable, more resilient and an even bigger contributor to the UK economy. Having worked at…