EG Group agrees £750m deal for Asda’s forecourts business
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Blackburn-based forecourts and retail giant EG Group has agreed a deal to acquire the petrol station business of Asda in a £750m transaction.
Last October EG announced that shareholders in the EG Group – the Issa brothers and TDR Capital – had reached an agreement to acquire a majority stake in supermarket giant the Asda Group for £6.8bn.
Today, EG Group said it has agreed to acquire certain assets of Asda, comprising its petrol filling stations, car washes and ancillary land, known as the forecourt business.
In December, the Competition and Markets Authority (CMA) announced it was investigating the Asda takeover.
Today, EG said its acquisition of the forecourt business is subject to the same CMA regulatory clearance being received by the group’s shareholders for their acquisition of Asda.
Subject to these approvals, the transaction is currently expected to close in the second quarter of 2021.
Financing options are currently being considered but, post-synergies, the transaction is expected to be leverage-neutral and accretive to the group’s financial performance.
A detailed integration plan will ensure a seamless transition into EG Group’s UK operations, which have successfully integrated four significant acquisitions since 2015.
The forecourts, which will remain an integral part of the broader retail locations where they are situated, will continue to be Asda branded and will remain a price leader in the fuel market.
Zuber Issa and Mohsin Issa, co-founders and co-CEOs of EG Group, in a joint statement, said: “We are excited to have the opportunity to further strengthen our network in the UK through the proposed acquisition of Asda’s forecourt business, which will enhance our position as a major independent forecourt operator and provide a platform for future growth of the combined network.”