Asda’s billionaire owners are reportedly negotiating the sale of part of the supermarket’s property holdings, valued at £500 million.
- Macquarie Asset Management is nearing a deal to acquire 50 Asda store leases in the UK, as reported by React News.
- The transaction includes a provision for Asda to regain ownership for a nominal sum at the lease’s conclusion.
- This move enables Asda to raise substantial equity, addressing its escalating debt concerns.
- Previously, the Issa brothers sold 25 Asda stores to Realty Income Corporation, raising £650 million.
Asda’s billionaire owners, Mohsin and Zuber Issa, are reportedly in discussions to divest another segment of the supermarket’s real estate, in a deal valued at approximately £500 million. According to React News, Macquarie Asset Management, an Australian finance entity, is on the brink of securing leases associated with 50 Asda locations throughout Britain. These ground rent leases are set to endure for 50 years.
A strategic clause in the agreement allows Asda to re-acquire the ownership of these properties for a minimal fee at the end of the term. This financial strategy not only facilitates a considerable injection of equity but also assists in alleviating the substantial debt burden that Asda is currently facing.
This initiative follows a previous transaction executed in July, where the Issa brothers sold off 25 of Asda’s stores to a United States investor, Realty Income Corporation, for a sum of £650 million. As part of that arrangement, Asda also entered into a leaseback agreement.
Earlier in the year, the Issa brothers orchestrated a $1.5 billion transaction involving their EG Group’s U.S. property assets, which included selling 415 stores on the U.S. East Coast to Realty Income. This maneuver highlights their ongoing strategy to leverage property assets for financial restructuring.
In a separate yet related move, the EG Group’s UK and Ireland operations were acquired by Asda for £2.27 billion. This acquisition encompassed 350 petrol filling station sites and over 1,000 food-to-go outlets, demonstrating the group’s expansive growth strategy in the retail sector.
The Issa brothers continue to strategically manage Asda’s assets to optimise financial performance and mitigate debt.
