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Issas seal a £440m deal for German fuel stations

Blackburn’s Issa brothers – who bought Asda for £6.8bn – sign a £440m deal to buy 285 petrol stations in Germany

The Issa brothers’ EG Group has signed a £440m deal to buy 285 petrol stations in Germany amidst fears over its debt mountain. 

The acquisition from OMV is the second deal signed since Blackburn-based Zuber and Mohsin Issa bought Asda for £6.8billion in October, and extends their business’ 6,000- strong network of petrol stations and convenience stores. 

It follows a Moody’s decision to downgrade EG Group because of the way the company reports its £7billon debt pile, as well as governance issues which prompted its auditor Deloitte to resign. 

Petrolheads: Mohsin and Zuber Issa have extended their business’ 6,000- strong network of petrol stations and convenience stores.

The purchase of Asda, which is being investigated by the UK competition watchdog, will be Britain’s largest leveraged buyout in more than a decade. 

The Issas sold new preference shares – considered halfway between debt and traditional equity – in the firm to two Canadian pension funds and Abu Dhabi’s sovereign wealth, in a deal that valued the firm at around £15billion. 

The deal was seen as a way of providing cash to help pay for Asda. The company said the acquisition was funded from existing cash reserves and loans, and would be ‘leverage neutral’. 

EG’s like-for-like sales fell 23 per cent to £11.8billion in the nine months to September, but earnings rose 17 per cent to £562m thanks to resilient performance in its food business. 

Read more at DailyMail.co.uk