EG Group, the petrol forecourts business whose billionaire founders also own supermarket chain Asda, have snapped up food-to-go business Leon for £100m.

Mohsin and Zuber Issa said the deal to acquire the 70-strong Leon restaurant chain offered EG Group “fantastic opportunities” to build out its network, including drive-through and forecourt sites. 

The healthy-eating fast-food chain was founded in London in 2004 by by John Vincent, its chief executive, Henry Dimbleby and chef Allegra McEvedy, both of whom left the business a few years later. 

The deal will lead to payouts for the trio as well as paydays for Leon’s twin private-equity majority shareholders Active Partners and Spice Private Equity, which own 30% and 40% stakes respectively. 

The Issas said: 

“Leon is a fantastic brand that we have long admired. As established entrepreneurs in the foodservice retail market ourselves, we have a huge admiration for the business that John and the Leon team have built over the years, and firmly believe that their culture and values closely align with our own.   

The acquisition of Leon presents EG Group with a fantastic opportunity to further develop the menu offer, the various concession formats including drive thrus, and will enable us to significantly build on the existing network by exploring opportunities across our own sites along with other strategic locations.  

EG Group continues to identify innovative partnerships and acquisitions that complement our existing consumer offer and enable us to stay at the forefront of consumer trends, particularly in foodservice. Our equity investment in Leon is to strengthen our own participation in the fast-growing contemporary foodservice segment. This acquisition aligns with our commitment to being a committed foodservice operator globally, delivers financial benefit to our underlying business, and supports broader commercial strategies to be able to better realise further growth opportunities.”

Departing chief executive Vincent said: “Mohsin and Zuber will not just be superb custodians of the Leon brand, through EG Group they have the vision, investment appetite, foodservice expertise and network scale to take Leon to many more people and places.

“It was such a difficult decision. I was all set to spend the next five years building up after Covid, taking advantage of real-estate opportunities. But the Asda owners wanted a food brand to put in their forecourts and gas stations.”

Vincent said the Issa brothers would be “superb custodians” of the Leon brand and were “decent, hard-working businesspeople”. 

Leon will join a number of other fast-food brands in the EG Group portfolio, which runs Subway and Greggs stores on its petrol stations and also bought the largest UK KFC franchise last year. 

EG Group’s owners and founders the Issa brothers and TDR Capital last year agreed a £6.8bn deal to buy supermarket chain Asda from its US parent company Walmart.

The brothers are also apparently eyeing up a move for national high street coffee chain Caffè Nero. 

The Issas appointed retail veteran Lord Stuart Rose as chair of EG Group after former auditors Deloitte resigned over governance concerns. 

EG Group’s unaudited results for the year to December 2020 showed like-for-like sales fell by a quarter when lockdowns restricted customer travel.

EG said that food retailing across its more than 6,000-strong petrol station empire accounted for 46% of total profits in the UK and Ireland. 

The acquisition of Leon could raise doubts over the healthy fast-food chain’s previous exclusive supply deal for groceries and food-to-go meals with Asda rival Sainsbury’s.

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