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Asda reports slowdown in rate of quarterly sales growth

FILE PHOTO: An ASDA employee walks beneath a company logo outside a store in Manchester, northern England, July 8 , 2016. REUTERS/Phil Noble/File Photo

LONDON (Reuters) - Asda, the British supermarket arm of Walmart that has agreed to be acquired by rival Sainsbury's, reported a slowdown in the rate of underlying sales growth in its fourth quarter.

Britain's third largest food retailer after market leader Tesco and No. 2 Sainsbury's said its like-for-like sales rose 1 percent in its fiscal fourth quarter, compared with a 2 percent rise in the previous quarter.

The results still mark the seventh straight quarter of underlying growth and mean Asda has been outpacing its potential buyer. In January, Sainsbury's reported a 1.1 percent fall in third quarter underlying sales.

"The year ahead looks no less turbulent than the last, with uncertainties around Brexit playing on our customers' minds," Asda CEO Roger Burnley said. "Whilst I am pleased with our performance in 2018 we must remain focused on ensuring the long term sustainable success of Asda for our customers."

Asda agreed in April to a £7.3 billion cash and shares takeover by Sainsbury's - a combination that could overtake Tesco as Britain's biggest supermarket group if it is approved by the country's competition regulator.

The Competition and Markets Authority is currently probing the deal and is due to publish its preliminary findings this month.

(Reporting by Kate Holton; Editing by Alistair Smout and Jane Merriman)