Petrol station tycoons and private equity houses are understood to be among those interested in taking a majority stake in Walmart-owned Asda.
Potential bidders include entrepreneurs Zuber and Mohsin Issa, the billionaire founders of forecourt giant EG Group, The Sunday Telegraph reported.
Also in the running is US buy-out specialist Lone Star Funds, which is interested in Asda’s property, according to The Sunday Times.
Walmart decided to seek a stake sale or IPO of Asda following the collapse of a merger deal with Sainsbury’s last year. Last week, Walmart confirmed there was interest in the purchase of a majority stake in Asda from a number of parties.
The Issa brothers have built EG Group into a business with sales of £12bn trading from 5,200 locations. Lone Star owns a housing development next to Wembley Stadium.
There has been speculation that other private equity groups might be interested in Asda. However, according to The Times, some of the biggest are not likely to bid. Advent International, Blackstone, The Carlyle Group, KKR and Permira were all reported by the newspaper to have passed on the opportunity.
Although Asda’s freehold on approximately 75% of its stores is appealing to some potential investors, others have been put off by the intensity of competition in grocery and are more interested in online businesses.
Walmart and Asda said last week: “We are in discussions with a small number of interested parties who share Walmart and Asda’s commitment and passion to growing the business. No decisions have been made and we will not be commenting further on these discussions.”
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