Asda Delivery

News about ASDA online and home delivery service

Issa brothers owners of EG group have bought the major shareholding in ASDA from Walmart. EG Group are a huge petrol forecourt operator with 5,900 sites across Europe and the US. It is thought that the ISSA brothers have bought ASDA for the 3300 petrol forecourts under its operations. The ISSA brothers are busily trying to sell off the other parts of ASDA. The Issa brothers petrol forecourt business model is one of offering non-petrol retail to consumers while paying for fuel. It has worked well for them up to now. They have even had other retail brands operating at their forecourts such as Starbucks, Subway, Greggs, KFC Burger kings and little Chef roadside restaurants. This is confirmed with their trial of 3 Asda convenience stores operating from 3 of its UK petrol forecourts. It is thought that profits from the sale of petrol to be very competitive, leaving small margins, however as any shopper knows the price of goods at petrol forecourts are expensive being a captive audience.

The Issa brothers plan seems to be one of acquiring the ASDA forecourts by taking over ASDA and then obtaining the equity with temporary loans that will be paid back, at least in part, by selling off many parts of ASDA that don’t fit their business model. With ASDA owning 70% of the freehold property their stores operate from, the Issa brothers have a sale and leaseback option to raise further funds to pay back loans raised. ASDAs freehold property is though to be valued at about £4 billion. The purchase price of ASDA was £6.8 billion

For those waiting for exciting things to happen now, will probably have to wait. ASDA George is being toted as being up for sale.