Walmart is selling Asda Group, its UK grocery subsidiary, to bigger rival J Sainsbury in a deal valued at £7.3 billion (US$10 billion).
Under the agreement announced Monday, April 30, Walmart would hold 42% of the combined company, which would become the United Kingdom’s largest supermarket company, overtaking Tesco plc.
The merged company will have a total revenue of about US$51 billion, based on 2017 figures, and a network of more than 2,800 Sainsbury’s, Asda and Argos stores, including supercenters, superstores, supermarkets and convenience stores, as well as some of the UK’s most-visited retail websites, for a combined 47 million customer transactions weekly.
Through the transaction, Walmart will receive £2.975 billion (US$4.1 billion) in cash and 29.9% of Sainsbury’s shares, with the balance held as nonvoting shares convertible into voting shares.
“We believe the combination offers a unique and exciting opportunity that benefits customers and colleagues,” Walmart president and CEO Doug McMillon said in a statement. “As a company, we’ve benefited from doing business in the UK for many years, and we look forward to working closely with Sainsbury’s to deliver the benefits of the combination.”
Full Content: Wall Street Journal
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