Walmart in talks to sell controlling stake in Asda
Asda’s owner, the US retail titan Walmart, is in early-stage talks about selling a controlling stake in the UK supermarket, the two firms revealed today.
Walmart, the world’s largest retailer, said the discussions had begun after “inbound interest” from a small number of firms.
The announcement came just under a year after Asda’s planned £7.3bn merger with rival Sainsbury’s was thwarted by regulators on the grounds that it would stifle competition.
A person with knowledge of the talks said the interested parties were private equity firms, but said the talks at this stage were informal.
They said Walmart would maintain a significant minority stake under any deal.
“Together, we are in discussions with a small number of interested parties who share Walmart and Asda’s commitment and passion to growing the business,” Walmart and Asda said in a joint statement.
“No decisions have been made and we will not be commenting further on these discussions. If or when we decide to pursue this opportunity further our first priority will be to share more detailed information with our colleagues.”
Walmart last year said it was weighing up listing Asda on the stock market. The US retail giant today said it “firmly believes that an initial public offering is an attractive long-term objective for Asda. Asda is a great business with a clear strategy for the future”.
A sale to a private equity firm would leave the door open to an IPO in the future, although the decision would no longer be Walmart’s to make.
The potential sale would fit into Walmart’s international strategy, which has seen it pivot towards growth markets in recent years.
In 2018, the US firm took a $18bn majority stake in Indian online retailer Flipkart and has also partnered with Chinese retail giant JD.com.