The U.K. supermarket space has drawn renewed attention from investors following the tie-up between Walmart's Asda and J Sainsbury.
The $10 billion deal between the two grocers, announced last week, was welcomed by the investment community, but according to one asset manager, Tesco is still the best stock pick.
"Perhaps with most other people, we've been focused on Tesco," Henry Dixon, asset manager at Man GLG, told CNBC's "Squawk Box Europe" on Thursday.
"I think the Sainsbury's-Asda news is pretty interesting," he said, adding that it may not mean a higher market share for the companies involved, however.
Sainsbury's and Asda are, respectively, the second and the third largest supermarkets in the U.K. If approved by regulators, their tie-up could mean that they would surpass Tesco as the largest food retailer in the U.K. But, Dixon said: "If you go back and look at the Morrisons deal for Safeway, what was clear when companies merge, they lose quite a bit of market share."