UK retailer Asda has agreed to acquire Co-op’s petrol forecourt business for an enterprise value of £600 million (€698.9 million).
The deal will support Asda’s growth strategy to move into the convenience market.
For Co-op, the divestiture will allow the business to focus on its core convenience proposition.
Shirine Khoury-Haq, chief executive at the Co-op, added, “This transaction is in line with our strategy to move away from operating petrol forecourts and supports our vision of co-operating for a fairer world while building our core leading convenience business.
“I would like to thank our incredible colleagues in these stores, and we will work closely with Asda to ensure a smooth transition.”
The transaction includes 129 petrol forecourt sites, spread across the UK, representing 5% of Co-op’s retail estate comprising 2,564 stores.
It also includes three sites under development and will see Asda acquire 132 convenience stores.
Co-op employs around 2,300 people in the business that it is divesting.
All people employed by the cooperative will transfer to Asda’s employment under TUPE transfer following completion of the deal and transition period.
'Significant Growth Opportunity'
Mohsin Issa, Co-owner of Asda, said, “We see convenience as a significant growth opportunity for the business. This acquisition accelerates our strategy in this area and forms part of our long-term ambition to become the UK’s second-largest supermarket.
“We look forward to welcoming the Co-op colleagues to this new part of our business after we complete the transaction and due processes in the coming months.”
The stores being acquired as part of the transaction generated net sales of £863 million (€1 billion) and pro forma EBITDA of £53 million (€61.7 million) for 12 months to June 2022, Asda noted.
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