Asda’s £2 Billion Acquisition of EG Group’s UK Business: What It Means for Shoppers
The purchase of EG Group’s UK business by Asda has been finalized, with Asda now planning to introduce its convenience brand, Asda Express, to 356 EG sites. Additionally, 119 former Co-op Group sites are in the process of transitioning to Asda Express. Asda aims to lower prices for groceries and fuel across its expanded estate, which is expected to create job opportunities for the company. This acquisition is a crucial part of Asda’s strategy to offer value-driven convenience through Asda Express at EG Group locations, enhancing its presence and bringing value pricing closer to customers.
This strategic move builds on Asda’s acquisition of 119 convenience sites with attached petrol filling stations from the Co-op Group, which have started the transition to the Asda Express brand. Furthermore, Asda has already successfully launched three standalone Asda Express convenience sites since October 2022.
With the acquisition of EG Group’s UK business, Asda now boasts 478 convenience stores and plans to open an additional 300 standalone convenience stores by the end of 2026, furthering its growth in the convenience sector. This is in addition to its existing estate of 580 supermarkets, 31 Asda Living stores, and 321 petrol filling stations.
Mohsin Issa, co-owner of Asda, expressed enthusiasm about bringing the iconic Asda brand to more communities, while Lord Stuart Rose, Chair of Asda, highlighted the company’s commitment to delivering value to consumers. The acquisition of EG Group’s UK business is a significant step in Asda’s long-term ambition to become the UK’s second-largest supermarket.
This acquisition also accelerates Asda’s entry into the £62 billion foodservice market, with the addition of 462 Greggs, Burger King, and Subway outlets as franchise agreements. Asda now wholly owns Leon and intends to introduce it to its stores.
The combined entity resulting from the acquisition is expected to have combined revenues of nearly £28 billion, serving approximately 21 million customers every week. It will encompass convenience, fuel, general merchandise, grocery, foodservice, and omni-channel retailing, all under Asda’s heritage of value and a customer-first approach.
The revised acquisition price reflects adjustments made during the negotiation process, with Asda expecting to generate over £250 million of incremental EBITDA within the first two years post-synergies, mainly driven by economies of scale and cross-selling opportunities.
Lord Stuart Rose will continue to serve as Chairman of the new, combined business, alongside Dame Alison Carnwath as Non-Executive Director, and Mohsin Issa and Gary Lindsay as Directors of the combined business. The Asda Board is also planning to add new independent non-executive directors to ensure strong corporate governance.