The future is uncertain for two supermarkets located next to each other at a busy roundabout after the owners announced one of the most audacious mergers in British retail history.

Sainsbury’s confirmed this week it has agreed terms for a £12 billion union with Walmart-owned Asda.

There are two Sainsbury’s and Asda stores opposite each other at the Dome Roundabout, in Colne Way, Garston.

Representatives from both the stores could not confirm any future plans to the Watford Observer - including whether the shops will move into one building.

However, a spokesperson for Sainsbury’s said: “There are no planned Sainsbury’s or Asda store closures as a result of this transaction.”

The duo - the UK's number two and three supermarkets - said on Monday that the unified group would have combined revenues of £51 billion and boast a network of 2,800 Sainsbury's, Asda and Argos stores.

It will aim to generate £500 million in cost savings but Sainsbury's insisted there are no planned store closures as part of the merger, with both brands to operate side by side.

The combined supermarket expects to lower prices by around 10 per cent on products customers buy regularly.

It will see Asda owner Walmart hold 42 per cent of the new business and receive £2.97 billion in cash, valuing Asda at £7.3 billion.

Sainsbury's chairman David Tyler said: "We believe that the combination of Sainsbury's and Asda will create substantial value for our shareholders and will be excellent news for our customers and our colleagues.

"As one of the largest employers in the country, the combined business will become an even greater contributor to the British economy."

Following the tie-up, the two grocers will continue to have their own chief executives, Sainsbury's under Mike Coupe and Asda under Roger Burnley.

Mr Coupe said: "This is a transformational opportunity to create a new force in UK retail, which will be more competitive and give customers more of what they want now and in the future.

"It will create a business that is more dynamic, more adaptable, more resilient and an even bigger contributor to the UK economy.

"Having worked at Asda before Sainsbury's, I understand the culture and the businesses well and believe they are the best possible fit.

"This creates a great deal for customers, colleagues, suppliers and shareholders and I am excited about the opportunities ahead and what we can achieve together."