Retail 'to see many mergers and takeovers due to Brexit'
Brexit is helping drive a fresh wave of UK takeovers in the retail sector as supermarkets consider deals that will help avoid price hikes amid surging inflation, the former boss of Waitrose had said.
Steven Esom, a retail veteran who served as the managing director of Waitrose from 2002 to 2007, said retailers are now turning to mergers and acquisitions (M&A) as a means to control costs and maintain market share.
"Any business looking at their cost base can see the advantage of consolidation," he said, explaining that sales volumes are "absolutely key to keep costs down" for consumers.
"People are looking at making their businesses more efficient and clearly any type of inflation passing through - that's got to be mitigated.
"So I would think that businesses are doing this to mitigate the effects of inflation."
His comments come amid a flurry of M&A activity in the supermarket sector, with Tesco currently attempting a £3.7bn merger with Booker.
A tilt by Sainsbury's to acquire Nisa is also thought to be on the cards, while reports emerged earlier this summer that Walmart-owned Asda was exploring a £4.4bn takeover of discount retailer B&M.
"Businesses are now looking at every way of increasing volumes to mitigate costs," Mr Esom said.
Since the Brexit vote triggered the pound's collapse, retailers have faced rising import costs and falling consumer confidence.