Issas’ £6.8bn Asda deal moves forward
The Competitions and Markets Authority signed off on the takeover after considering the Lancashire-based brothers’ proposal to sell 27 EG Group petrol stations.
Mohsin and Zuber Issa, along with private equity firm TDR Capital, moved to acquire the supermarket chain from US-based Walmart in October. The brothers and TDR Capital made the deal through jointly-owned Bellis Acquisition Company, which would become the majority shareholder for the Asda brand. Under the takeover agreement, Walmart would retain an equity investment in the business and a seat on the board.
The deal financially completed in February, but was subject to government regulatory approval.
Part of the takeover involves Bellis acquiring all of Asda’s forecourt business, including petrol filling stations, car washes and ancillary land.
The CMA initially raised concerns over the deal after noting that many of the 395 Issa-owned EG Group petrol stations in the UK were in similar locations to 323 Asda-owned stations. The proposal to sell 27 stations appears to have alleviated that issue.
EG Group is already speaking with prospective buyers for the 27 sites.
“We are pleased to have worked constructively with the CMA to reach a positive outcome,” said the brothers in a joint statement. “We are now focused on supporting colleagues and customers at the 27 sites during their transition to new ownership.
“EG’s acquisition of Asda’s forecourt business will further enhance EG’s position as a leading independent forecourt operator and provide a platform to further accelerate the growth of our complementary foodservice and convenience store operations.”
Roger Burnley, CEO of Asda echoed those words. “We can now fully embark on the next stage of our journey under new ownership and work with Mohsin, Zuber and TDR to build an even stronger Asda that gives our customers outstanding choice, value and service in our stores and online,” he said.