The Competition and Markets Authority (CMA) has greenlit the Issa brothers and TDR Capital takeover of Asda following an eight-month investigation into potential competition concerns.
The CMA has accepted the Issa brothers’ offer to sell 27 of its petrol stations to lessen competition concerns, smoothing the way for their £6.8bn acquisition of Asda to be completed. The brothers are the co-owners of petrol forecourt business EG Group.
The Issa brothers completed the deal in February, but until now had been under an Initial Enforcement Order ‘Hold Separate’, which prevented them from dealing directly with the day-to-day management of the grocer. The order has now been lifted, allowing Asda’s new owners to push ahead with their strategy for the business.
In a joint statement, TDR and the Issa Brothers said: “We welcome the CMA’s announcement today marking the end of its review process and acceptance of our proposed undertakings.
“We can now push ahead with our exciting plans for Asda and look forward to working with the Asda management team to invest in the business to drive growth, including continuing to accelerate Asda’s online offer, sourcing more food from UK farmers, and bringing enhanced convenience to customers.”
Asda chief executive Roger Burnley also welcomed the announcement.
“We welcome today’s announcement from the CMA, which means we can now fully embark on the next stage of our journey under new ownership and work with Mohsin, Zuber and TDR to build an even stronger Asda that gives our customers outstanding choice, value and service in our stores and online,” he said.
The Issa brothers and TDR Capital first announced they had reached a £6.8bn agreement with former Asda majority stakeholder Walmart in October 2020.
The competitions watchdog had been investigating the acquisition to ensure it didn’t increase prices or lessen competition for customers, particularly around EG Group’s sprawling, 6,000-strong international petrol forecourt business.
Now that the deal has gone through, the Issa brothers plan to plough £1bn into Asda during the first three years of ownership, with a focus on lowering prices and shoring up its supply chain.
It is already trialling a new convenience fascia, Asda on the Move, at a clutch of EG’s petrol station forecourts – a format that is likely to be rolled out further now the acquisition has been approved.
The new owners will now also be able to push ahead with appointing a successor for current chief executive Burnley, who announced in March he’d be stepping down from Asda next year after the best part of four years at the helm.
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