LONDON: The British Muslim billionaire Issa brothers and private equity group TDR Capital have agreed to buy the British supermarket chain Asda from Walmart for an enterprise value of $8.8 billion and plan to roll out more smaller stores.
The deal will enable Mohsin and Zuber Issa, who founded petrol station operator EG Group nearly two decades ago, to take Asda back under British ownership for the first time since 1999, when Walmart paid 6.7 billion pounds for the business.
The new owners want to drive growth at Britain’s third-biggest supermarket chain by expanding its presence into smaller neighborhood shops to add to its large supermarket format, bringing it more in line with competitors Tesco and Sainsbury’s which offer both.
Walmart will retain an unspecified equity investment in the business, an ongoing commercial relationship and a seat on the board, while British retail veteran Roger Burnley will remain in charge at Asda.
“After a successful period as part of Walmart we are looking forward to helping Asda build a differentiated business that will continue to serve customers brilliantly in communities across the UK,” the brothers said.
The new owners will invest more than 1 billion pounds in the next three years in Asda to keep prices low and to protect its supply chains.
British finance minister Rishi Sunak welcomed the deal for Asda which will retain its headquarters in the northern English city of Leeds.
Britain’s highly competitive supermarket sector has been upended this year by the COVID-19 crisis which sparked a jump in sales — and costs — as shoppers stocked up on goods during lengthy lockdowns.
While Asda’s sales increased, the chain still lagged market leader Tesco, Sainsbury’s, and smaller rival Morrisons.
All of the so-called big-four supermarket chains have also faced fierce competition from German discounters Aldi and Lidl in recent years.
In response, Walmart previously sought to sell Asda to Sainsbury’s for 7.3 billion pounds but the deal was thwarted by Britain’s competition regulator last year.
The lower price announced on Friday reflects the integration benefits that a merged Asda-Sainsbury’s would have produced. ($1 = 0.7744 pounds)
Walmart sells Asda to billionaire British Muslim brothers and TDR for $8.8 bln
https://arab.news/wedd8
Walmart sells Asda to billionaire British Muslim brothers and TDR for $8.8 bln
- The new owners want to drive growth at the supermarket chain by expanding its presence into smaller neighborhood shops to add to its large supermarket format
- The new owners will invest more than 1 billion pounds in the next three years in Asda to keep prices low
Closing Bell: Saudi benchmark index closes lower at 10,540
RIYADH: Saudi equities ended Wednesday’s session lower, with the Tadawul All Share Index falling 55.13 points, or 0.52 percent, to close at 10,540.72.
The sell-off was mirrored across other indices, with the MSCI Tadawul 30 Index retreating 5.79 points, or 0.41 percent, to close at 1,393.32, while the parallel market Nomu slipped 74.56 points, or 0.32 percent, to 23,193.21.
Market breadth remained firmly negative, as decliners outpaced advancers, with 207 stocks ending the session lower against just 51 gainers on the main market.
Trading activity moderated compared to recent sessions, with volumes reaching 123.5 million shares, while total traded value stood at SR2.72 billion ($725.2 million).
On the sectoral and stock level, Al Moammar Information Systems Co. led the gainers after surging 9.96 percent to close at SR172.30, extending its rally following a series of contract announcements tied to data center and IT infrastructure projects.
Al Masar Al Shamil Education Co. climbed 4.89 percent to SR27.48, while Naqi Water Co. advanced 3.36 percent to SR58.50. Al Yamamah Steel Industries Co. and Al-Jouf Agricultural Development Co. also posted solid gains, rising 3 percent and 2.86 percent, respectively.
Losses, however, were concentrated in industrial names. Saudi Kayan Petrochemical Co. fell 3.67 percent to SR4.73, while Makkah Construction and Development Co. slid 3.44 percent to SR80.
Saudi Tadawul Group Holding Co. retreated 3.28 percent to SR147.50, weighed down by broader market weakness, and Saudi Cable Co. declined 3.18 percent to SR143.
Alkhaleej Training and Education Co. rounded out the top losers, shedding just over 3 percent.
On the announcement front, BinDawood Holding announced the signing of a share purchase agreement to acquire 51 percent of Wonder Bakery LLC in the UAE for 96.9 million dirhams, marking a strategic expansion of its food manufacturing footprint beyond Saudi Arabia.
The acquisition, which remains subject to regulatory approvals, is expected to support the group’s regional growth ambitions and strengthen supply chain integration.
BinDawood shares closed at SR4.68, up 0.43 percent, reflecting a positive market reaction to the overseas expansion move.
Meanwhile, Al Moammar Information Systems disclosed the contract sign-off for the renewal of IT systems support licenses with the Saudi Central Bank, valued at SR114.4 million, inclusive of VAT.
The 36-month contract is expected to have a positive financial impact starting from fourth quarter of 2025, reinforcing MIS’s position as a key technology partner for critical government institutions. The stock surged to the session’s limit making it the top gainer.
In a separate disclosure, Maharah Human Resources confirmed the completion of the sale of its entire stake in Care Shield Holding Co. through its subsidiary, Growth Avenue Investments, for a total consideration of SR434.3 million.
The transaction involved the transfer of 41.36 percent of Care Shield’s share capital to Dallah Healthcare, with Maharah receiving the full cash proceeds.
Despite the strategic divestment, Maharah shares closed lower, ending the session at SR6.12, down 1.29 percent.
