Asda buys EG Group UK petrol stations. British supermarket retailer Asda said it would buy petrol station operator EG retailer’s UK and Ireland division to accelerate its drive into the convenience sector, creating a company with combined revenues of about 30 billion pounds ($38 billion).
Zuber and Mohsin Issa and TDR Capital control Asda, Britain’s third-largest retailer, and EG.
The purchase, which comprises 350 gas stations and over 1,000 food-to-go facilities, values EG at 2.27 billion pounds, including debt, the businesses said on Tuesday.
Asda wants to overtake Sainsbury’s (SBRY.L) to become Britain’s No. 2 supermarket, and the agreement will let it roll out Asda Express across the EG fuel estate.
According to Kantar’s latest data, Tesco dominates the market with 27.1%. Asda trails Sainsbury’s with 13.9%.
Since the Issa brothers bought Asda in 2021, 166 EG sites have been transformed into the “Asda on the Move” model.
The deal comes as consumers face a cost of living problem, forcing supermarkets to balance rising food prices with increasing wages and competition from German discounters Aldi and Lidl.
Asda, which like rivals, sells cheap gas at its massive stores, said it would invest more than 150 million pounds in integrating EG over the next three years.
Asda’s shareholders, including Walmart Inc., will contribute 450 million pounds to the acquisition.
The grocer reported 7.8% like-for-like sales growth in the three months to March, while overall revenues excluding fuel rose 8% to 5.0 billion pounds.
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