1. ITV Report

Sainsbury's joins forces with discount supermarket Netto

Netto supermarkets have not been seen in the UK since 2010. Photo: PA

Discount supermarket Netto is to make a return to the UK as part of a joint venture with Sainsbury's that will take on booming rivals Aldi and Lidl.

The Danish supermarket, which left the UK in 2010, will open 15 stores in the next year in a deal funded by Netto owner Dansk Supermarked and Sainsbury's.

ITV News Consumer Editor Chris Choi reports.

Sainsbury's said the move allows it to enter the fast-growing discount sector, worth an estimated £10 billion a year, without diluting its reputation.

The big four supermarkets - Sainsbury's, Morrisons, Asda and Tesco - have seen their market shares slip amid competition from discount retailers such as Aldi and Lidl and upmarket rival Waitrose.

The first new Netto store will open in the north of England and will sell a range of fresh food as well as incorporate an in-house bakery.

Mike Coupe, Sainsbury's chief executive designate, said:

This joint venture provides a great opportunity for us to gain exposure to the high-growth discount market for the first time.

When Netto left the UK market five years ago it sold its 198 stores to Asda. The business was first established in the UK in 1990.