LONDON (Reuters) - Sainsbury's has lost its status as Britain's No. 2 supermarket group by market share to takeover target Asda for the first time in four years as industry data confirmed Sainsbury's as the sector laggard.
Sainsbury's sales fell 1.8 percent over the 12 weeks to March 24, reducing its market share to 15.3 percent from 15.8 percent in the same period last year, researcher Kantar said.
That meant Asda, the British arm of U.S. retailer Walmart (NYSE:WMT), overtook Sainsbury's with a market share of 15.4 percent as its sales edged up 0.1 percent in the period.
Kantar said Sainsbury's remained the biggest seller of food and drink out of the two retailers as its figures do not include the Argos general merchandise business it acquired in 2016.
Sainsbury's agreed 7.3 billion pound ($9.5 billion) takeover of Asda is currently being considered by Britain's competition regulator.
The Competition and Markets Authority (CMA) said last month its initial view was that the deal should be blocked in the absence of the sale of a large number of stores, or even one of the brands. A final report is due by April 30.
Kantar's data showed Tesco's sales rose 0.5 percent in the period and it remained the clear market leader with a share of 27.4 percent. Sales at No. 4 player Morrisons fell 0.1 percent, giving it a market share of 10.3 percent.
However, all of Britain's so called "big four" supermarkets lost market share to German-owned discounters Aldiand Lidl. Their sales increased 10.6 percent and 5.8 percent respectively, giving them a combined market share of 13.6 percent.