The development aims to tackle the company’s significant debt burden. Credit: EG Group.

EG Group, the petrol station operator co-owned by the billionaire Issa brothers and private equity company TDR Capital, is in talks to sell some of its UK assets to co-founder Zuber Issa, the Financial Times (FT) reported.

This move aims to tackle the company’s significant debt burden, which has attracted recent scrutiny.

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The news agency noted that discussions are underway between EG Group and Zuber Issa regarding the divestment of certain assets in the UK and Ireland. The proceeds from this potential sale will be used solely for debt repayment, contributing to EG Group’s financial health.

Additionally, the deal could potentially lead to a clearer separation of business interests between the Issa brothers. Zuber Issa would focus on the petrol station business while Mohsin Issa would continue overseeing Asda, the supermarket chain the brothers co-own with TDR Capital.

EG Group has been actively pursuing debt reduction through various measures, including asset sales. This proactive approach stems from pressure to manage its debt levels following a period of rapid expansion.

The company’s net debt has decreased from $9.6bn at the end of 2022 to $5.9bn by the end of 2023.

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Notably, EG Group completed the sale of most of its UK and Irish business to Asda in October 2023 for £2bn ($2.54bn) through a leveraged buyout.

According to the FT, the specific assets being considered for sale to Zuber Issa are expected to comprise approximately 30 petrol stations not included in the previous Asda deal and select food locations.

EG Group’s electric vehicle charging business and other assets are not expected to be part of this potential transaction.

This potential deal with Zuber Issa signifies EG Group’s ongoing efforts to improve its financial health.

The company remains committed to expanding its international business while simultaneously managing its debt levels responsibly.