By Leos Rousek

PRAGUE--The Czech competition office UOHS Friday said that Koninklijke Ahold N.V. (AH.AE) has to sell an unspecified number of stores at four Czech cities to allow the Dutch retailer complete its acquisition of SPAR shops in this central European country.

"In its preliminary ruling the office has concluded that this (Ahold/SPAR) merger raises concerns about significant distortions of competition at four (Czech) cities where the two retails have overlaps and their combined market shares significantly exceed 40%," the UOHS said.

The Czech competition watchdog gave its preliminary approval for the merger, citing sufficient evidence provided by Ahold that it was working on selling businesses in the four Czech cities.

Ahold officials in Prague declined to name the four local cities where the company will have to divest its stores.

Earlier Friday the Dutch retailer said it expected completion of the merger transaction in the second half of the year.

Ahold currently ranks among the top five local Czech retailers in revenue terms by operating 228 grocery supermarkets and 56 large-format stores, selling clothes and other goods along with food products. SPAR, which has it has been losing money in the Czech Republic for several years, operates 50 stores of various sizes on the local market.

Write to Leos Rousek at leos.rousek@wsj.com, @LeoRousek

Go to http://blogs.wsj.com/emergingeurope for the new WSJ and Dow Jones blog on Central and Eastern Europe, covering business, politics, society and more, written by our correspondents across the region.

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