Jobs boost as Asda meets demand for Netto stores sale

ASDA said it is on track to create more than 400 jobs in Yorkshire and Humber after it met the Office of Fair Trading's demand that it sell a number of Netto stores.

This was seen as the last major hurdle to Leeds-based Asda's 778m acquisition of budget retailer Netto, announced last spring.

Asda said the sale of 39 out of the 47 stores it was required to sell means it is on track to create up to 430 jobs in Yorkshire and Humber following the conversion of 43 Netto stores.

Subject to final OFT approval, the 43 Netto stores in Yorkshire and the Humber region will be converted to Asda supermarkets by late autumn. They will trade under the Asda supermarkets banner and will average 8,000 sq ft in size.

The retailer said that customers will be able to complete a full weekly shop in each store.

Judith McKenna, Asda chief financial officer, who led the deal, said: "The good news for shoppers here in Yorkshire is that there'll be no premium to shop in one of our smaller stores. We'll charge the same low prices you'll find in any of our stores."

Following Asda's initial announcement, last May, that it intended to purchase Netto's stores in the UK, the OFT asked the retailer to find buyers for 47 stores across the UK before it would move to the next stage of its process.

As a result, 14 Netto stores in Yorkshire and Humber will be sold to Morrisons, Iceland and Haldanes, which will continue to run them as food stores.

Morrisons said it has entered into a conditional agreement with Asda to acquire 120,000 sq ft of additional selling space through the purchase of 16 former Netto UK stores at a cost of 28.1m.

Dalton Philips, chief executive of Morrisons, said: "These additional stores are an important next step in Morrisons' growth. We are building on our strategy to bring Morrisons' unique offer of freshly prepared, affordable food to more people in Britain."

Asda said that only the Netto store in Keighley, West Yorkshire, remains unsold but it will be selling this store in the coming months.

Asda described the OFT's announcement as a key milestone in the company's purchase of the UK Netto stores.

The addition of Netto stores to Asda's regional portfolio will give the retailer 70 stores in Yorkshire and Humber.

Asda employs more than 2,700 people at its national head office in Leeds, and a further 6,100 in its network of regional stores.

Judith McKenna added: "This is a key day in our plan to bring Asda to more customers in many more communities in Yorkshire and Humber. We're delighted that we're a step closer to welcoming hundreds of Netto colleagues here in our heartland of Yorkshire and Humber into Asda, and look forward to welcoming many more."