The UK’s Competition and Markets Authority (CMA) has referred a proposed £14bn merger between supermarket groups J Sainsbury and Asda Group for an in-depth Phase 2 investigation.

Last month, the competition regulator opened its Phase 1 probe into the merger proposal and the firms sought a fast-track referral to Phase 2.

According to the CMA, the Phase 1 probe found sufficient concerns for a more in-depth review.

Sainsbury’s and Asda are leading grocery retailers in the UK. As their outlets overlap in hundreds of areas, shoppers may face the risk of higher prices or lower-quality services. These concerns will be investigated in the Phase 2 probe alongside other issues, including fuel, general merchandise and clothing, and increased buyer power over suppliers.

“The panel will gather evidence through customer surveys and engagement with other retailers.”

The Phase 2 probe is a more in-depth review that will be led by a group selected from the CMA’s independent panel members.

This group will be chaired by Stuart McIntosh, with the other members being Roland Green, John Thanassoulis, Richard Feasey and Claire Whyley.

The panel will gather evidence through customer surveys and engagement with other retailers, suppliers and industry bodies for an in-depth analysis.

The proposed merger was announced in April. If the deal materialises, Sainsbury’s would take control of US-based Walmart subsidiary Asda.

Walmart would secure almost £3bn in cash and 42% of the combined business, reported Financial Times.

If the regulatory body concludes that the proposed merger would lessen competition in the market, the two entities will be required to sell stores.