Issa brothers owned Asda 'to offload 13 sites' to push through £600m deal
Issa brothers owned supermarket Asda looks set to overcome competition concerns over its £600 million deal to buy Co-op petrol forecourts after putting forward proposals to offload 13 sites.
Britain’s competition watchdog said it is considering accepting Asda’s plans to appease concerns – after warning earlier this month the deal could result in “higher prices or less choice” for motorists and shoppers across 13 sites.
Asda and its owners, the Issa brothers and private equity backers TDR Capital, put forward proposals last week that included selling 13 petrol stations with adjoining grocery stores from the 132-strong portfolio of forecourts it snapped up last autumn.
The Competition and Markets Authority (CMA) said there are “reasonable grounds for believing that the undertakings offered… or a modified version of them, might be accepted”.
It now has until May 30 to consider the offer and make a final decision.
An Asda spokesman said: “We welcome the update from the CMA on our proposals and will continue to work collaboratively with them to address their concerns.”
The CMA launched its investigation into the acquisition in January.
It said in mid-March the takeover “raises competition concerns” in 13 locations across the UK.
The UK’s third largest supermarket chain secured the takeover in October as part of plans to grow its petrol station business.
The deal is seeing 2,300 workers move over from the Co-op to the supermarket group.
The new focus on forecourts and convenience stores comes after Asda’s £6.8 billion takeover by the Issa brothers and TDR Capital, who also own the EG Group forecourt giant.
In August, the Co-op first revealed plans to sell its 132 petrol stations and attached convenience stores in a bid to bolster its finances.
The Co-op said proceeds from the sale will be reinvested in its core convenience shops, pricing, stores operations and reducing its debt burden.
The CMA also forced Morrisons’ new owner, US private equity firm Clayton Dubilier & Rice to sell off a number of petrol forecourts last October over competition concerns.