The delay follows the submission of two proposed remedies by GXO in response to the CMA’s interim report, which raised concerns that the merger could reduce competition in dedicated warehousing services for UK grocery retailers.
“GXO submitted amendments to its proposals including significant modifications to one remedy, which require detailed consideration by the Inquiry Group,” stated Richard Feasey, Chair of the Inquiry Group, in the notice published on 9 April.
GXO’s proposed remedies
To address the CMA’s concerns, GXO has offered two possible solutions:
- 3PL Sponsorship Remedy: This is GXO’s preferred option. It involves setting up a sponsorship fund to support the entry or growth of alternative third-party logistics providers (3PLs) in the grocery warehousing market. In addition, GXO proposes offering contract term guarantees to ensure continuity for current and future grocery clients.
- Divestiture Remedy: Under this alternative, GXO would sell parts of Wincanton’s grocery warehousing business—including relevant contracts, assets, and personnel—to a CMA-approved buyer.
Both remedies were presented for consultation in March. The CMA published an Invitation to Comment on Remedies on 6 March 2025, with a deadline for third-party feedback set for 18 March. A Remedy Meeting between GXO and the CMA followed on 25 March, after which GXO submitted significant amendments to its preferred remedy.
Regulator warns deal could limit food storage options
In its interim report published in February, the CMA warned that the merger could restrict competition in the supply of dedicated warehousing services to UK grocers. GXO, Wincanton and DHL are the three leading providers in this niche market, and the regulator noted that switching to in-house warehousing or other providers may not be feasible for all supermarket chains.
“Our initial view is that this merger could raise the costs of these services and reduce choice for supermarkets who rely on these services for moving goods across the country,” said Feasey.
GXO has maintained that the CMA’s concerns are disproportionate, highlighting that grocery warehousing represents less than 10% of Wincanton’s £1.4 billion annual revenue. The company argues that supermarkets are sophisticated buyers with multiple alternatives and that the wider Wincanton business poses no competition issues.
While the CMA has now formally extended its decision deadline to 25 June 2025 under Section 39(3) of the Enterprise Act, the regulator emphasised that it aims to conclude the inquiry sooner if possible.
“The Inquiry Group aims to complete the inquiry as soon as possible and in advance of this date,” the CMA stated.
The final outcome will determine whether GXO secures full regulatory clearance for the deal and is permitted to integrate Wincanton into its operations. The two companies have remained operationally separate under an Interim Enforcement Order since the merger was completed in April 2024.
