Lancashire-based Euro Garages founders Zuber and Mohsin Issa have bought Asda from Walmart in a £6.8bn deal.
It means Asda will return to majority UK ownership for the first time in more than twenty years.
The Issa brothers, originally from Blackburn, have over 5,200 petrol stations across the UK and Europe. Initially called Euro Garages, they founded EG in 2001, expanding it from a single site in Bury, Greater Manchester.
Teaming up with private equity firm TDR Capital they take a majority stake of the supermarket chain. TDR Capital now owns half of the group, with Zuber Issa controlling 25% and Mohsin Issa the remaining 25%.
Asda will remain headquartered in Leeds and will continue to be led by current chief executive Roger Burnley.
Walmart has been looking to offload Asda for some time. The budget supermarket has been in a tough battle with Lidl and Aldi who have rapidly grown their market share.
Announcement of the new buyout comes more than a year after a proposed merger between Asda and Sainsbury’s was blocked by competition regulators who said the combined firm would reduce choice for consumers.
Mohsin and Zuber Issa said in a statement: “We are very proud to be investing in Asda, an iconic British business that we have admired for many years.
“Asda’s customer-centric philosophy, focus on operational excellence and commitment to the communities in which it operates are the same values that we have built EG Group on.
“Asda’s performance through the COVID-19 pandemic has demonstrated the fundamental strength and resilience of the business, and we are excited to support Roger and his team as they continue to reposition the business to drive long-term growth.
“We believe that our experience with EG Group, including our expertise around convenience and brand partnerships and our successful partnership with TDR Capital, can help to accelerate and execute that growth strategy.
“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.”
Walmart bought Asda in 1999 for £6.7bn, and will retain minority stake in Asda and a seat on the board.
Mohsin and Zuber Issa said they wanted to support Asda’s management to achieve long-term growth.
“We believe that our experience with EG Group, including our expertise around convenience and brand partnerships and our successful partnership with TDR Capital, can help to accelerate and execute that growth strategy,” they added.
The auction process for Asda has lasted for several months. Walmart decided to sell a controlling stake in Asda after shelving plans to float the business following a failed £7.3bn merger with Sainsbury’s.
The supermarket recently announced its expansion into convenience stores and will initially trial “Asda On the Move” at three of EG Group’s fuel station forecourts in the Midlands.
Roger Burnley, chief executive officer of Asda, said: “This new ownership opens an exciting new chapter in Asda’s long heritage of delivering great value for UK shoppers.
“With our combined investment, expertise and ambition, Asda, Walmart, the Issa brothers and TDR have an incredible opportunity to accelerate our existing strategy and develop an even more exciting offer for our customers as well as strengthen our business for our colleagues.
“In a constantly changing retailing environment, our new ownership will further enhance our resilience, whilst creating significant, additional opportunities to drive growth.
“For Asda colleagues, a strong and growing business is important for our long-term future.”