Walmart, which owns the UK supermarket chain, has restarted sale talks following the pandemic.
Talks are back underway regarding the possible sale of Asda, after having been placed on hold during the Covid-19 pandemic. Walmart, which owns the UK retailer, had started talks back in February, a few weeks before lockdown came into effect.
Last year, the UK Competition and Markets Authority blocked Walmart’s efforts to merge Asda with Sainsbury’s amidst fears the move would lead to an increase in prices. The CMA then prohibited Sainsbury’s from acquiring a stake in Asda or any of its subsidiaries or from buying an interest in any business that has a holding interest in Asda for the next 10 years. The rules will be bound until July 9th 2029, unless the parties receive the “prior written consent of the CMA”. Had it been successful, the deal would have seen Walmart retain 42% of the combined business. The American retailer then said it was considering a stock market flotation for Asda.
A spokesperson has said this is the ‘right time’ to restart Asda sale discussions with potential investors: “Walmart and Asda have restarted conversations with a small number of third-party investors who are interested in acquiring a stake in Asda and partnering with Walmart, following renewed inbound interest.” They added: “There is no certainty that a transaction will happen.”
Among the top three supermarkets in the UK, Asda claims an estimated 15% of the market. It has faced increased competition from discount chains, especially Germany’s Aldi and Lidl.