EG Group co-chief executives the Issa brothers and private equity firm TDR Capital are set to acquire Asda with equal shareholdings.

The £6.8 billion deal will be done on a debt-free and cash-free basis, with current owner Walmart retaining an equity investment, ongoing commercial relationship and a seat on the board.

With support from its new ownership, Asda will continue to invest in accelerate its omnichannel offer and in the resilience of its supply chain, according to a statement.

Asda will remain headquartered in Leeds and will continue to be led by Roger Burnley, who will form part of the board, alongside representatives appointed by the Issa brothers, TDR Capital and Walmart.

Burnley said: “In a constantly changing retailing environment, our new ownership will further enhance our resilience, whilst creating significant, additional opportunities to drive growth.

“For Asda colleagues, a strong and growing business is important for our long-term future.”

The new owners promised to invest more than £1 billion in the next three years to further strengthen the business and its supply chain, along with maintaining competitive pay levels for Asda colleagues.

“As well as accelerating Asda’s existing strategy, the Issa brothers will bring significant additional expertise, particularly in convenience retail and brand partnerships, drawing on their experience of building a global convenience retailer with more than 6,000 sites,” read the statement.

Mohsin and Zuber Issa stated: “We believe that our experience with EG Group, including our expertise around convenience and brand partnerships and our successful partnership with TDR Capital, can help to accelerate and execute that growth strategy.

“After a successful period as part of Walmart we are looking forward to helping Asda build a differentiated business that will continue to serve customers brilliantly in communities across the UK.”

The transaction is subject to regulatory approvals and is expected to complete during the first half of 2021.

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