EG Group could shed 40 forecourt sites to meet Competition and Markets Authority requirements
The list of sites which could potentially be sold by EG Group to enable its owners to secure their deal to buy Asda, has been revealed and is a more detailed version of the original response announced on May 5 by the Competition Markets Authority (CMA).
The ‘proposed divestment’ list has spiked interest in the forecourt sector as buyers seek out a highly prized site from the EG Group portfolio around GB. The list features developments in Scotland and England, including the hight value site known as Rushden Services, a £2.7m development in Northamptonshire, which opened earlier this year. An auto-LPG site in the Bridge of Dee in Aberdeen, also features on the list.
The CMA announced in April that the Issa brothers and TDR C had jointly offered to divest of 27 EG Group forecourts. The CMA considered that “there are reasonable grounds for believing that the undertakings offered jointly by Mr Zuber Issa, Mr Mohsin Issa and TDR Capital LLP, or a modified version of them, might be accepted by the CMA under the Enterprise Act 2002, and that it is considering the offer”.
The divestment would occur either as a sale of the freehold or, subject to the CMA’s approval, the grant of a leasehold title with a minimum 25-year term which may be subject to a break clause at 15 years exercisable at the option of the purchaser, and/or where the Issa Brothers and TDR hold the freehold interest in the site, or even by way of an assignment of a leasehold interest.
The CMA is of the view that the Proposed Undertakings may be capable of ready implementation, in particular in light of the option to divest alternative and, if needed, additional sites. The CMA also said the divestment sites are stand-alone businesses and the parties have provided evidence that there is high demand for petrol stations, and that there are several potential purchasers specifically interested in the divestment sites currently offered by the Issa Brothers and TDR.
The CMA has until July to decide whether to accept the undertakings, with the possibility to extend this time frame if it considers that there are special reasons for doing so.