US retail giant Walmart is expected to complete a £6.5billion sale of Asda on Friday.
The ‘big four’ grocer’ will be sold to a consortium comprising private equity firm TDR Capital and petrol station tycoons Mohsin and Zuber Issa.
The sale of a controlling stake in the supermarket will see it return to British ownership for the first time since 1999.
Walmart, which has been in talks to sell Asda for several years, is expected to seal the deal on Friday, according to Sky News.
However, an Asda spokesman declined to comment on any speculation.
It comes two months after the company revived talks with potential investors, after putting Asda’s sale on hold due to the coronavirus pandemic.
If successful, it would put a £6.5billion price tag on Asda just over a year after the UK’s competition and markets authority (CMA) blocked a takeover deal with Sainsbury’s over fears it would lead to higher food and fuel prices for consumers in the UK.
A Walmart spokesman said it was the “right time” to revive the talks.
“Walmart and Asda have restarted conversations with a small number of third-party investors who are interested in acquiring a stake in Asda and partnering with Walmart, following renewed inbound interest,” a spokesman at the time added.
It is understood that TDR capital and the Issa brothers were chosen as Walmart’s preferred bidders in the past fortnight.
Walmart, which purchased Leeds-based Asda in 1999, has overhauled its international strategy in recent years to focus on new markets, such as Asia, where it has forged alliances with local partners, such as JD.com in China.
In 2018, it announced plans to merge Asda – which owns 15% of the UK grocery market – with Sainsbury’s in a deal in which would allow it to retain 42% of the combined business.
Stuart McIntosh, chair of the CMA’s inquiry group, said it had a “responsibility” towards shoppers to ensure the market offered them a fair deal.
“It's our responsibility to protect the millions of people who shop at Sainsbury's and Asda every week,” a statement said at the time.
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“Following our in-depth investigation, we have found this deal would lead to increased prices, reduced quality and choice of products, or a poorer shopping experience for all of their UK shoppers.
"We have concluded that there is no effective way of addressing our concerns, other than to block the merger."
The CMA's investigation found that, as well as affecting in-store customers, the merger would result in reduced quality of service, such as fewer delivery options, when shopping online.
Furthermore, it said the deal could lead to motorists paying more at over 125 locations where Sainsbury's and Asda petrol stations are located close together.
However Sainsbury’s CEO Mike Coupe accused the regulator of taking money out of people’s pockets.
“The CMA is today effectively taking £1 billion out of customers’ pockets,” he warned.
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