The Issa brothers, the new owners of ‘Big Four’ grocer Asda, are reportedly considering a £3bn sale of its clothing arm George.
According to the Mail on Sunday, industry sources have told the paper that the sale of George is one of several strategies being considered by the new owners alongside the idea of separating its alcohol business or having it run by a third party.
However, reports also suggest that sources close to the Issa brothers have said that any strategies that involve splitting off parts of the business are currently not being contemplated.
While any deal is still yet to be officially completed, earlier this month Walmart confirmed the Issa brothers and TDR Capital had agreed the deal to take a majority stake in Walmart’s wholly-owned UK business on a debt-free and cash-free basis.
The transaction is expected to be finalised in the first half of 2021.
Walmart said it would retain an equity investment in the business, with an ongoing commercial relationship and a seat on the board.
The Issa brothers, backed by TDR Capital, said they will “support and accelerate” Asda’s existing business strategy.
It comes as Asda reports a doubling of its online operations during the course of the pandemic. With “support” from its new ownership, Asda said it will continue to “invest in accelerating its omnichannel offer” and in the “resilience of its supply chain”.
Asda will also remain headquartered in Leeds, and will continue to “be a significant contributor to the UK economy and tax base”.
Currently, the business is to continue to be led by Roger Burnley who will form part of Asda’s board alongside representatives appointed by the Issa brothers, TDR Capital and Walmart.