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Asda has raised USD 742 million through sale-and-leaseback deals on 24 stores and a depot to strengthen its finances and reduce debt. The supermarket, owned mainly by TDR Capital, will continue operating all sites under long-term lease agreements. With net debt of 3.8 billion pounds, Asda faces falling sales and declining market share, which dropped to 11.6% over a recent 12-week period. Competitor Aldi is rapidly closing the gap. The funds are intended to support business investment and stabilize operations ahead of the company's upcoming third-quarter results.
British supermarket group Asda has secured 568 million pounds (USD 742 million) by entering into sale-and-leaseback agreements on 24 stores and a depot, providing a significant cash injection amid ongoing sales challenges. The retailer, largely owned by private equity firm TDR Capital, plans to invest the proceeds into the business and reduce its net leverage. Advertisement
At the end of last year, Asda's net debt stood at 3.8 billion pounds. The sale-and-leaseback deals were divided among several buyers: four stores were sold to DTZ Investors, 10 stores and a depot at Lutterworth in central England were sold to Blue Owl Capital, and another 10 stores went to a joint venture between Blue Owl Capital and Supermarket Income REIT. All properties are under 25-year lease agreements, with an option to extend for an additional 10 years. Asda will continue its operations at all these locations without interruption.
Asda has been steadily losing market share to rivals such as Tesco and Sainsbury's. Recent industry figures indicate that over the 12 weeks ending early November, Asda's sales fell 3.9% year-on-year, and its market share declined by 1 percentage point to 11.6%. Discount retailer Aldi is closing in, holding a 10.6% market share. Former owner Walmart continues to maintain a 10% stake in Asda.
The supermarket chain has acknowledged that profits are under pressure as it undertakes a business reset. The company is scheduled to release its third-quarter results in the upcoming week.
Source Reuters
5th Jun, 2025
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