Industry figures have told Retail Newsagent that merger talks are taking place between Nisa and Bestway – but both companies have denied the claims.

It comes after three senior industry sources told the magazine that the two companies have been looking at the possibility of a deal that would see them joining the two businesses.

“The two companies are in talks. That’s as far as it’s got, but they are looking at the possibility of a merger or subsuming Nisa into Bestway,” one industry source, who wished to remain anonymous, told Retail Newsagent.

“The talks have been going on for about a fortnight, but they have not concluded and they may not conclude.

“It’s not the first time a Bestway Nisa merger has been looked at. A similar deal was explored several years ago, but the two parties couldn’t agree certain elements of the deal and it was shelved.

“Obviously the marketplace has changed since then, but let’s see what happens.”

He added he had spoken to various people in the trade as well as contacts at Nisa and Bestway about the rumours. A second source told Retail Newsagent: “I’ve heard it’s a done deal at a time when Booker is becoming very dominant like Tesco.”

Both companies have denied the rumours, which come weeks after Nisa announced the biggest annual swing in profit in the company’s history. The symbol group’s end-of-year figures for the 2016 financial year revealed adjusted earnings of £7.3m, compared to losses of £2.9m for the previous year. Chief executive Nick Read attributed the company’s success to a new approach to running the business.

Meanwhile, Bestway this week announced a board restructure following managing director Younus Sheikh’s move to a non-executive role.

Martin Race has been appointed managing director, Naser Khan, previously finance director, has taken on the role of chief operating officer, while Dawood Pervez replaces Mr Race as trading director.

From September, Rizwan Pervez will move from operations director to the newly-created post of customer liaison director, while Paul Rowland joins as head of operations.