Asda completes £2bn acquisition of EG Group’s UK business

By Tim Aldred

01 Nov 2023

Asda Express

Asda Group completed the acquisition of EG Group’s UK business for £2.07bn, allowing it to expand its Asda Express network.

EG Group was founded by the Blackburn-based Issa brothers, who are also co-owners of Asda.

The transaction creates a group with expected combined revenues of nearly £28bn, serving 21m customers every week. It will also bring together convenience, fuel, GM, grocery, foodservice and omni-channel retailing.

The deal follows Asda’s acquisition of 119 convenience sites with attached filling stations from the Co-op Group, which started to convert to the Asda Express fascia last month, and the launch of three stand-alone Asda Express convenience sites since October 2022.

Asda will now roll out its Asda Express across EG UK’s 356 predominantly freehold sites, which include modern convenience stores on petrol filling stations, while committing to opening a further 300 stand-alone convenience stores by the end of 2026. 

The EG Group acquisition also accelerates Asda’s move into the £62bn foodservice market, with the transfer of 462 Greggs, Burger King and Subway outlets as franchise agreements. Asda now wholly owns Leon, which it will also look to introduce to its stores.

Mohsin Issa, co-owner of Asda, added: “We have worked at pace over the last 12 months to deliver a compelling convenience proposition from a standing start - as well as investing more than £120m in lowering the price and further improving the quality of our food.

"With the deal complete, we can focus on delivering the growth opportunities. That means lowering the price of fuel for more motorists, bringing Asda’s great value and quality to more communities, offering greater opportunities to our supplier partners and creating sustainable job opportunities for colleagues in our stores and depots.

"I’d like to thank the teams at Asda for their efforts to bring this transaction to completion and welcome our new colleagues from EG UK who have joined the Asda family.”

Gary Lindsay, managing partner at TDR Capital LLP which owns Asda with the Issas, said: “This transaction is all about growth – and bringing together the complementary strengths of Asda and EG UK. We are creating an enhanced and more diverse Asda business that delivers even greater value for its customers on a daily basis in stores and online.

"Becoming the number two UK supermarket again and delivering a stronger and more compelling proposition for UK consumers are the metrics we will judge the success of this transaction by.”

Lord Stuart Rose will continue in his role as chairman of the new, combined business alongside Dame Alison Carnwath as non-executive director as well as Mohsin Issa and Gary Lindsay as directors of the combined business. The board continues its recruitment process for a permanent chief executive.

It is the intention of the Asda board to add new independent non-executive directors to ensure continued strong corporate governance.

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