An investigation into the £762 million takeover of a Wiltshire based firm has raised concerns over “higher costs” across the UK.

In April, a deal was completed for logistics giant Wincanton, headquartered at Methuen Park in Chippenham, to be acquired by US firm GXO Logistics.

Wincanton is the supply chain partner for major supermarket operators such as Sainsbury's, Morrisons, and Asda, and leading businesses like Primark and IKEA.

The £762 million deal was struck after GXO outbid CEVA Logistics UK.

At the time, it was announced the two firms would continue to be run independently until the UK Competition and Markets Authority (CMA) had completed its review.

Phase one of this investigation was launched in September and the findings were published on Friday, November 1.

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The Wincanton offices in ChippenhamThe Wincanton offices in Chippenham (Image: Trevor Porter) The CMA found the purchase could “reduce competition in the mainstream contract logistics services market” and that this might mean “price rises” for business customers in the UK.

It is feared a potential lack of competition in distribution, transport, and warehousing if the two firms are no longer competing for contracts would mean increased costs for customers.

Naomi Burgoyne, senior director of mergers at the CMA, said: “Contract logistics services are critical for the flow of goods around the country, reducing delays, and ensuring that products reach their destinations efficiently and reliably.

“These services are essential for millions of people who rely on timely deliveries or being able to buy products off the shelf.

“This market is worth £16 billion in the UK, and we’re concerned that this merger could reduce competition, resulting in higher costs being passed down to consumers.

“We consider that these competition concerns warrant an in-depth phase two investigation, unless GXO offers solutions which address them.”

GXO has five working days to submit proposals to address these concerns before a phase two investigation is launched.

The firm says it is reviewing the decision and remains confident of obtaining the green light to proceed.

A spokesperson added: “We are reviewing the decision and will continue to engage constructively and collaboratively with the CMA to secure a positive outcome.

“We strongly believe that the transaction will deliver meaningful benefits for contract logistics customers in the UK, Europe and globally, and will support the UK Government’s objective to drive economic growth by creating a more efficient and effective supply chain.

“The UK logistics market is highly competitive, and competition will remain robust for years to come.

“We remain confident in obtaining regulatory clearance and look forward to beginning to integrate our two great businesses.”