The new owners of Asda have promised a £1 billion investment in its supply chain, including an increase in the proportion of UK-based suppliers, while leaning on Walmart to provide “global innovation and buying power”.
Walmart will retain an equity investment in Asda after agreeing terms for a £6.8 billion sale of a controlling stake in the retailer to a consortium led by Lancashire-based brothers Mohsin and Zuber Issa – the billionaire owners of petrol forecourt firm EG Group – and private equity firm TDR Capital.
The US retail giant said that Asda had demonstrated huge resilience during the Covid-19 pandemic, almost doubling its online operations.
It said that with support from its new ownership, Asda would continue to invest in accelerating its omnichannel offer and in the resilience of its supply chain, including sourcing more food from UK farmers and maintaining its commitment to supporting domestic suppliers and small businesses.
It said it was specifically targeting the sourcing of chicken, dairy, wheat and potatoes to purchased from UK suppliers each year, and reaffirmed a commitment to source 100% British beef and retain payment terms for suppliers.
Roger Burnley, Chief Executive Officer of Asda, said: “With our combined investment, expertise and ambition; Asda, Walmart, the Issa brothers and TDR have an incredible opportunity to accelerate our existing strategy and develop an even more exciting offer for our customers as well as strengthen our business for our colleagues.
“In a constantly changing retailing environment, our new ownership will further enhance our resilience, whilst creating significant, additional opportunities to drive growth.”
The sale is subject to regulatory approvals and is expected to complete in the first half of 2021.