UK Competition Regulator Accepts Issa Brothers' Offer On Asda Deal
Britain's competition regulator has accepted an offer from the new owners of the Asda supermarket chain to sell 27 petrol stations, in order to satisfy concerns that the takeover could lead to higher fuel prices. It does not plan to refer the deal for an in-depth probe.
Zuber and Mohsin Issa and private equity group TDR Capital completed their purchase of a majority stake in Asda from United States giant Walmart in February in a deal valuing the chain at £6.8 billion ($9.6 billion).
In a separate deal in February, EG Group, which is also owned by the brothers and TDR, agreed to buy Asda's 323 petrol stations for £750 million.
EG Group operates about 400 petrol station sites in the UK.
In April, the Competition and Markets Authority (CMA) raised concerns over petrol prices and called on Asda's buyers to address them to avoid the deal being referred for an in-depth investigation.
Last month the CMA said it was likely to accept the buyers' disposal offer.
The Issa bros/TDR must now select a purchaser, or purchasers, for the petrol stations, which the CMA must approve for the deal to be finally cleared.
Though the financial transaction completed in February the CMA has a 'hold separate order' on Asda, which means the new owners can't yet be involved in the running of the business.
Last week, Asda said like-for-like sales, excluding fuel, rose 7.3% year-on-year in its first quarter to 31 March, versus a growth of 5.1% in the previous quarter.