BRITAIN'S supermarkets began the fight for Safeways last night - a move which could have profound effects on two North-East towns.

Directors of supermarket chains Asda, Tesco, Sainsbury and Morrisons met the Competition Commission to set out their plans for Safeway following acquisition.

In January, Morrisons announced a £2.9bn deal for Safeway, which led to fears of job losses in Darlington and Redcar where there would be two Morrisons stores following the takeover.

Yesterday, Sir Terry Healy, of Tesco, Sir Peter Davis, of Sainsbury, Sir Ken Morrison, and Tony de Nunzio, chief executive of Asda, argued their cases to the Competition Commission at a meeting in London.

Mr de Nunzio said that if Asda took over Safeway, customers could expect to pay lower prices.

Sir Ken Morrison said: "We could never mount a challenge to the big three operators through organic growth alone."

Sainsbury's argued that if either Asda or Tesco was to acquire Safeway, "the resulting duopoly would be bad for both customers and suppliers".

Sir Terry Leahy, of Tesco, said Safeway customers whose stores converted to Tesco would see prices fall by about 11 per cent on a range of products.