Connect with us

Hi, what are you looking for?


Asda set to announce £10bn merger with petrol stations group EG

<?xml encoding=”utf-8″ ??>

Asda is finalising a deal to buy its sister business EG Group’s UK and Irish petrol forecourts in a deal worth £3bn, allowing the supermarket to step up its shift into convenience retailing.

The businesses are expected to formally announce a long-awaited tie-up in the next few days, which will create a combined business worth about £10bn.

The two groups are owned by the billionaire Issa brothers and the private equity firm TDR Capital, and are chaired by former Marks & Spencer boss Stuart Rose.

Asda is expected to pay about £3bn for EG, supported by about £500m lent by the credit arm of US-based investment firm Apollo Global Management.

The proceeds will help EG reduce its onerous debt burden, according to Sky News, which first reported the merger timing.

Talks about a potential deal have been under way for months, as the cost of servicing billions of pounds worth of debt held by EG has surged after a flurry of interest rate rises.

About £7bn of EG’s debt is reportedly due to be repaid in 2025, piling pressure on the business, while Asda has also been squeezed by rising costs on energy, wages and its products – as well as a tough consumer market as households battle with a rapid rise in the cost of living.

The new group will operate nearly 600 supermarkets, 700 petrol forecourts and 100 convenience stores and the deal is not expected to be scrutinised by the competition watchdog, the Competition and Markets Authority (CMA), which already considers the two businesses as one because of their shared ownership.

The GMB union, which represents thousands of Asda workers, has called on the government to block the merger, which had been anticipated, arguing it will be bad for consumers and workers.

Nadine Houghton, GMB organiser, said: “GMB believes this merger requires proper scrutiny from the CMA. We are concerned rising interest rates will leave the debt of the UK’s third largest retailer unsustainable.

“GMB’s priority is to protect and improve our members’ jobs and conditions and we believe this merger makes that harder.”

EG is expected to retain its headquarters in Blackburn, Lancashire, from where it will operate its international business, which includes forecourt businesses in the US and across Europe while Asda will continue to be based in Leeds, Yorkshire.

However, the deal is expected to generate about £100m of cost savings and to drive forward Asda’s shift into convenience stores.

Asda was bought out by the billionaire Issa brothers and the private equity firm TDR Capital for almost £7bn in 2020.

Since then it has undergone a series of cost-cutting moves including reducing premiums for delivery drivers and workers near London, closing pharmacies and changing night shifts.

The supermarket had already announced a plan to open 200 Asda On the Move convenience sites on EG petrol forecourts. The retailer is also acquiring 132 convenience stores from the Co-op.

You May Also Like


THE Securities and Exchange Commission (SEC) said it received on Wednesday the registration statement of SM Investments Corp. (SMIC) for a P15-billion fixed-rate bond...


Longtime tennis habitues know injuries have been part and parcel of Roger Federer’s campaigns on the back end of his career. The last decade,...


BW FILE PHOTO THE CENTRAL BANK wants lenders to keep a close eye on environmental and social (E&S) risks in their credit exposure, in...


The healthcare ecosystem is one that has thrived on the cusp of scientific progress, benefitting enormously from the winds of change in the technological...

Disclaimer:, its managers, its employees, and assigns (collectively "The Company") do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

Copyright © 2022 PoliticalInvestorsDaily. All Rights Reserved.