Asda completes acquisition of 132 Co-Op sites subject to CMA approval

The acquisition, which was initially announced at the end of August for a cash value of £438m, includes 129 existing sites and three development sites.

Around 2,300 staff employed by The Co-op will move to Asda’s employment under TUPE transfer in the coming months, following consultation with the union USDAW.

In a statement, Asda said: “While the sale of the sites has now formally completed and Asda owns the 132 sites, the deal remains subject to regulatory approval from the CMA (Competition and Markets Authority). “The CMA has issued an ‘Initial Enforcement Order’ requiring that the Co-Op sites remain entirely separate from Asda whilst the CMA conducts it investigation into the deal, a process that is expected to take until mid-2023.

“During that time the sites will be run separately to the Asda business and only following formal approval of the transaction will colleagues be able to transfer to Asda’s employment and the stores made part of the Asda estate.”

Mohsin Issa, co-owner of Asda said; “We are delighted to formally complete the transaction that we announced in August and taking the next step on our journey to creating a new and exciting part of our Asda business.

He added: “As millions of families deal with the day-to-day impacts of increasing costs of living, we’re committed to bringing Asda’s great value groceries and fuel to even more communities across the UK through these new stores.

"Over the last five years we’ve been consistently ranked as one of the cheapest providers of fuel in the UK and have been voted the Grocer’s best priced supermarket for 25 years in a row, meaning customers in these communities can look forward to saving millions annually on the cost of filling their shopping trolleys and tanks when Asda comes to town.

“We look forward to working collaboratively with the CMA on their investigation and to welcoming our new Asda colleagues to our great business in the coming months.”

The transaction has a total value of around £600m, including lease liabilities of approximately £162m.

Earlier this month, Asda revealed that consumers are rushing to buy energy-saving products as average household discretionary income fell by £141 a month on last year.

The supermarket’s latest Income Tracker shows the average household was £35.44 a week worse off compared with last September, primarily due to soaring utility bills.

The figure is an annual contraction of 14.6 per cent in September, having fallen by 14.3 per cent and 13.5 per cent in July and August respectively.

Asda said the tracker was set to fall further this month, when the Centre for Economics and Business Research expects inflation to further accelerate.

The energy price cap for the average household increased at the beginning of this month, contributing to an expected spike in price growth. In response, customers are increasingly turning to energy-saving products to try and keep their bills in check.

Asda said it has seen a 320 per cent increase in air fryer sales year-on-year while sales of slow cookers have more than doubled and sales of heated airers were 90 per cent up when compared with last September.