Potential £6.5bn takeover deal on the cards for Asda

It has been reported that the brothers behind one of Britain’s largest petrol station operators are poised to take over Leeds-headquartered Asda, in a deal which would value the supermarket chain at more than £6.5bn.

A consortium led by Mohsin and Zuber Issa, the bosses of EG Group, and TDR Capital, the London-based private equity firm which also has a stake in Doncaster headquartered developer Keepmoat Homes, has been chosen by American retail giant Walmart as the preferred bidder for Asda.

No deal has been officially struck yet and it could still be several days or weeks away. But the sale of a controlling stake in Asda would mean Walmart returns to majority British ownership for the first time in 21 years.

The Issa-TDR offer is believed to be supported by a syndicate of lenders including Barclays, ING, Lloyds Banking Group and Morgan Stanley.

The Blackburn-based brothers already have an existing relationship with the supermarket chain which announced plans to trial its “Asda On the Move” convenience store concept at three of EG Group’s forecourts. If successful, it is understood that the entrepreneurs and TDR want to retain Asda’s chief executive, Roger Burnley, in his post.

This is the latest  bid since the supermarket’s US owners Walmart confirmed in July it had restarted talks to sell its controlling stake in the business following a pause due to Covid-19.

Alongside this bid, is one from Apollo Global Management which was reportedly being led by the former chief executive of Debenhams, Rob Templeman.