The billionaire owners of Asda are exploring a merger of the supermarket and their UK petrol forecourts business, in a blockbuster deal that would create a retail giant worth more than £10bn. The merger talks are being held before a crunch refinancing at EG Group, which has £7bn of debt falling due in 2025 (The Times £).

The government could push back against plans by Mohsin and Zuber Issa for a £12bn merger of their petrol forecourts with those of Asda if it is felt it would push up pump prices (The Times £).

Some food firms may be using inflation as an excuse to hike prices further than necessary, the chairman of Tesco has said. Asked by the BBC’s Laura Kuenssberg if food producers were taking advantage of the poorest in society, John Allan said it was “entirely possible” (BBC). Tesco’s chairman has claimed food suppliers may be using inflation as an excuse to raise prices further than necessary as the cost of household staples soars (The Telegraph £).

Morrisons is cutting prices on hundreds more products as it battles to tempt shoppers back through its doors after last year being eclipsed by Aldi (The Telegraph £).

Plans to levy a deposit on plastic bottles to boost recycling in England, Wales and Northern Ireland have been delayed again by the government (Financial Times £).

Waitrose has dumped a porridge brand made by one of Britain’s oldest companies, as the supermarket reduces the number of products on its shelves amid the cost of living crisis (The Telegraph £).

Online petfood retailer Zooplus has hit out at Royal Canin’s “excessive” price increases, and instead offered customers 10% off its competitors (Sky News).

British retail sales dropped unexpectedly in December, as consumers dealt with rising inflation during the crucial Christmas shopping period (Financial Times £, The Times £, The Guardian). Cost-conscious shoppers curbed spending over the Christmas period, adding to the woes of retailers (Sky News).

M&S battles to regain its place in middle England’s heart – after decades of unsuccessful attempts to get its mojo back, it is understandable that Marks & Spencer bosses are hesitant to call the recent green shoots from its turnaround strategy as “job done” (The Times £).

A family-owned fruit and vegetable supplier is suing Lidl in a £2.7m claim that the German grocery giant destroyed its business. Deane Proctor, founder and MD of Proctor & Associates, claims he has been “stabbed in the back” by Lidl, which cancelled or slashed orders with insufficient notice and poached his own suppliers from under his nose (Daily Mail).

Groups representing more than 100,000 UK firms have accused ministers of taking a “scattergun” approach to supporting businesses with their gas and electricity costs, amid fears many will be forced to close this year by unaffordable bills (The Guardian).

A fine wines business backed by City grandee Michael Spencer has toasted record profits after sales rose to £132m. Bordeaux Index, which sells rare vintages through an online trading platform, saw pre-tax profit increased by 122% in 2021 to £5.9m (Daily Mail).

Majestic Wine is in good health after its divorce from Naked, says boss John Colley. He has just overseen the second busiest Christmas trading in the company’s 43-year history, narrowly behind the previous year’s record. Sales in December jumped by 21% compared with pre-Covid levels, while Dry January is not, so far, turning out as badly as he thought (The Times £).

From Don Papa to Casamigos: founders toast payday from spirits start-up boom. New brands have been snapped up by multinationals, but the market is increasingly crowded (Financial Times £).

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