Walmart selects billionaire brothers as preferred bidders for Asda
US retail giant Walmart has selected a consortium led by the billionaire brothers behind petrol station chain EG Group with private equity firm TDR Capital as the preferred bidder to buy Asda.
The deal would value the UK supermarket chain at more than £6.5bn, Sky News reported.
The broadcaster said that Mohsin and Zuber Issa, the owners of EG group, were the leading contenders to buy the controlling stake in the grocery giant, in a deal that would return Asda to British ownership for the first time in more than 20 years.
Walmart had been expected to select buyout firm Apollo Global Management, which had been working on an offer with former Debenhams boss Rob Templeman.
Private equity firm Lone Star Funds, which had been working with ex-Asda executive Paul Mason, pulled out of the race last week.
Walmart, the world’s largest retailer, was forced to place Asda up for auction after merger talks with Sainsbury’s were blocked by the competition regulator last year.
The Competition and Markets Authority warned that the tie-up, which would have created Britain’s largest grocer by market share, would be “expected to result in a substantial lessening of competition”.
Asda attracted a valuation of £7.3bn under the failed mega-merger talks with Sainsbury’s, however it is thought a private equity takeover will fail to attract as high a price tag.