Issas use Asda forecourts as collateral in loan deal

ASDA has used its new petrol forecourts as collateral in a fresh loan deal after the billionaire Issa brothers sold the sites from EG Group as part of their £2.1 billion merger of the two companies, the Standard has found.

- Simon Hunt

The finances of the UK's third-biggest supermarket chain have been a hot topic in the City since it changed hands in 2021, when US retail giant Walmart pulled out of the UK by selling a majority stake to the Blackburn-based entrepreneurs in a £6.8 billion deal.

The move was transformative for Mohsin and Zuber Issa, putting them in control of a company with 18 million customers a week and 145,000 employees. They set their sights on overtaking Sainsbury's to put their 600-store chain just behind industry leader Tesco.

They financed the deal with debt. Since interest rates started rising in December 2021, the cost of the capital used has increased significantly, stoking Square Mile speculation about the burden of the borrowing on Asda and the Issas. Rising rates and a worsening economic backdrop have also prompted banks across Europe to tighten their credit standards in recent months.