Zuber Issa to sell off Asda stake amid rift with brother

Mohsin and Zuber Issa are thought to be trying to disentangle their network of businesses – Jon Super

Zuber Issa is reportedly close to agreeing a deal to offload his 22.5pc share in the retailer to TDR Capital, according to Bloomberg News, which would hand majority control of the chain to the private equity giant.

The deal would increase TDR’s holding in Asda by about two-thirds, while the transaction would further dismantle the relationship between brothers Zuber and Mohsin Issa.

Zuber is separately trying to buy his brother Mohsin out of parts of the EG Group petrol station empire they built together. Details of the proposed EG Group deal were laid out to investors last month, who were told that the business is in “active discussions with Zuber Issa regarding the sale” of UK assets.

The potential changes at EG Group come as Mohsin, who remains on the board at the business, embarks on a new phase in his personal life.

Earlier this year, following a report by The Telegraph, Mohsin confirmed that he is in a romantic relationship with Victoria Price, a former partner at EY, which was Asda’s auditor until it quit in July last year.

Mohsin was subsequently forced to deny speculation of a rift with Zuber in an interview with the BBC, claiming they get on “exceptionally well” and speak daily.

The Issa brothers teamed up with London-based TDR to buy Asda for £6.8bn just three years ago from US retail giant Walmart.

However, the pair have endured a rocky tenure as the supermarket battles mounting debt pressures and falling market share. Asda currently has around £4.2bn of debt, which has led to hundreds of millions of pounds in interest costs.

Mohsin has been called for questioning by MPs twice in the past year amid concerns that Asda’s finances have led to price increases for customers.

They also inquired why Asda had set up companies offshore in Jersey, which Mohsin denied was for tax purposes.

The Telegraph revealed in February Zuber’s plan to offload his stake in the debt-laden supermarket, which was thought to be valued at more than £500m.

However, his attempts to exit Asda were complicated by so-called lock-in agreements with Mohsin and TDR. A sale would need to be approved by both.

Born in Blackburn, Zuber founded EG Group in 2001, bringing his brother Mohsin into the fold several years later and eventually building an empire of thousands of petrol stations around the world.

TDR, which also owns stakes in Stonegate Pub Company, Pizza Express and David Lloyd Leisure, has backed most of the Issas’ significant acquisitions since 2015.

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