Asda has announced a huge expansion wit6h 350 more petrol stations and 1,000 food to go shops as it buys EG Group for £2.27bn.
Asda, owned by the Issa brothers, investment funds managed by TDR Capital LLP and Walmart, is acquiring the EG UK and Ireland business through an affiliate of its parent company, Bellis Acquisition Company 3 Limited, a wholly-owned subsidiary of the Asda Group.
EG Group will retain approximately 30 PFS sites in the UK for wider group development and which will not form part of the transaction.
The combination of Asda and EG UK&I will allow Asda to serve a combined base of around 21m customers each week. Asda plans to invest more than £150m within the next three years to fully integrate the combined business.
Stuart Rose, Chair of Asda, said: “Asda’s acquisition of EG UK and Ireland will create a consumer champion like the UK has never seen. Throughout my career in retail – one thing has always been true, that meeting the evolving needs of customers is the route to growth.
“This transaction is all about driving growth by bringing Asda’s heritage in value to even more communities and accelerating the growth of its convenience retail business.”
Mohsin Issa, co-owner of Asda, said: “Asda is committed to saving customers precious time and money across their shopping baskets and on the forecourt. The combination of Asda and EG UK&I will be positive news for motorists, as we will be able to bring Asda’s highly competitive fuel offer to even more customers.
“I would like to sincerely thank all colleagues at both businesses for their ongoing efforts to serve our customers during tough economic times, and I look forward to welcoming our new colleagues from EG UK & I and expanding the Asda family further.”
Gary Lindsay, Managing Partner at TDR Capital LLP, said: “The combination of Asda and EG UK&I creates a convenience and food retailing champion, with nearly £30 billion in annual revenues. The two businesses are highly complementary, bringing together Asda’s traditional focus on mid-to-large sized supermarkets and EG UK&I’s on convenience retail, foodservice and fuel.
“At TDR Capital we’re proud to play our part in bringing the businesses together. We invest for the long term and this transaction is the realisation of a shared vision which began with our investment in EG in 2016. We are committed to help Asda reclaim its number two position in UK grocery, strengthening its position as a much-loved British brand that delivers great value to millions of customers every week.”
