The acquisition will help Asda leverage its expanding loyalty program and unite various aspects of convenience, fuel, general merchandise, grocery, foodservice, and omni-channel retailing.
(Image Source)
GLOAsda Group has announced its acquisition of EG Group’s UK and Ireland operations for approximately £2.27 billion. The deal aims to accelerate Asda’s growth strategy in convenience, omni-channel retail, and foodservice while expanding its customer base. The acquisition includes around 350 petrol filling station sites and over 1,000 food-to-go locations. Asda plans to roll out Asda Express across the EG UK and Ireland estate, bringing its value heritage to more customers and building on its previous acquisition of Co-op sites.
The strategic merger between Asda and EG UK&I will enable Asda to enhance its service to a consolidated customer base of approximately 21 million individuals on a weekly basis. Additionally, Asda will leverage its expanding loyalty program and unite various aspects of convenience, fuel, general merchandise, grocery, foodservice, and omni-channel retailing. This integration aligns with Asda’s core values of prioritizing customer satisfaction and offering value-driven retail experiences.
The transaction is expected to create synergies and generate additional EBITDA, with Asda committing to invest over £150 million in integrating the businesses. Asda remains committed to offering the lowest supermarket fuel prices and plans to extend its competitive fuel offer to more customers. The acquisition is anticipated to create a net increase in jobs for Asda and EG UK&I. Mohsin Issa, co-owner of Asda, will continue to lead the business while Asda searches for a new group CEO.
Asda reported a strong financial performance in Q1, with like-for-like sales growth of 7.8% and market share gains. The company’s investments in value and quality have resonated with customers, resulting in increased revenues. The acquisition of EG UK&I is expected to further strengthen Asda’s financial profile, generate additional synergies, and provide growth opportunities in the convenience and foodservice markets. The transaction is set to close in Q4 2023.
