Tesco's Jack's has a silly name but it's a better bet to succeed than Asbury's

The Competition & Market's Autority serendipitously announced a fullscale investigation into Sainsbury's planned merger with Asda on the day Tesco formally launched its new discounter. Both are reactions to the disruption of the UK grocery market

It was rather serendipitous of the Competition & Markets Authority (CMA) to announce a formal investigation into Sainsbury’s proposed £12bn merger with Asda on the day that Tesco hosted a tour of its new venture Jack’s, the discount chain with a silly name, in the Fenland town of Chatteris.

They are both belated reactions to the same thing, namely the disruption that has been brought to their once cosy(ish) marketplace by the likes of Aldi and Lidl, and to what may happen if and when Amazon fully bares its claws.

Which stands the better chance of succeeding?

Let’s look at Tesco first. The branding of its new venture is positively cringe-worthy. Jack’s, named for the group’s founder Jack Cohen, always puts me in mind of Jack the Lad, hardly a concept you’d want to associate a supermarket chain with.

You can see why the group is so keen to bang on about Britishness (every drop of fresh milk is British!). It fits with the nationalistic spirt of the times.

But it doesn’t matter how much bunting you use, and how many flags you fly, British shoppers will go where the price is right. If that means one of the German pair, assuming they have one of their outlets nearby, then so be it.

In the new venture’s favour, however, is the fact that Tesco CEO David Lewis has proven himself to be something of a whizz at running supermarkets.

Having revived a core business that was on its knees, he’s gone on to secure a merger with wholesaler Booker and struck a buying partnership with French giant Carrefour.

He has both the firepower, and the wherewithal, to make this work if he commits to it, and takes the inevitable growing pains on the chin.

More to the point, he is at least following the consumer.

Sainsbury’s is doing the opposite with its defensive mega-merger (you may remember that it trialled a discounter of its own in conjunction with Denmark’s Netto only to retreat).

It isn’t hard to predict what will happen from here on out. The CMA will receive a veritable forest of submissions, most of which decry the deal. Sainsbury and Asda will put the opposite case.

While this is going on, the two sides will be stuck in a strategic holding pattern while Tesco builds its Jack’s, Aldi and Lidl build yet more stores, and the merger partners’ market shares shrink.

At the end of the process, in maybe a year’s time, they will be told to sell off a number of their stores as a condition of the merger getting approved. They will then face the not inconsiderable challenge of putting two giant businesses together. Customer service will inevitably suffer during that process, however much their executives promise that it won’t.

By the time Asbury’s is finally firing on all cylinders, the market will look very different. Britain will look very different, if there is even much of a Britain left after the Brexiteers have done their worst.

The British grocery market isn’t a great place to be investing in right now. But if you have to back a horse, the one ridden by Mr Lewis looks like much the best bet.