Supermarket giant Asda has confirmed a major financial transaction, agreeing to sell a portfolio of 24 of its supermarkets and a crucial distribution depot in a deal valued at £568 million.
A Strategic Financial Move
This significant property deal is a strategic effort by the grocery retailer to bolster its financial standing. Asda, which had £3.8 billion in net debt at the close of 2024, is actively pursuing turnaround plans under the leadership of its boss, Allan Leighton. The company is set to provide a further update on its trading and financial position next week.
The arrangement is structured as a sale-and-leaseback, meaning Asda will immediately rent back the properties. This allows the retailer to continue operating all the affected locations without any disruption to service or changes for its employees.
The Buyers and the Deal Structure
The assets are being acquired by two distinct investment groups. US investment firm Blue Owl Capital is purchasing ten stores along with Asda's key depot located in Lutterworth, Leicestershire.
A further ten stores will be sold to a joint venture partnership between Blue Owl and Supermarket Income REIT, a real estate investment trust. The remaining four sites will be acquired by London-based DTZ Investors.
Both transactions will see Asda sign 25-year lease agreements for the properties, with options to extend the leases by an additional ten years, securing long-term operational control.
Asda's Property Strategy Explained
An Asda spokesman commented on the move, stating: "Asda’s property strategy is centred on maintaining a strong freehold base while also taking a considered and selective approach to unlocking value from our estate where appropriate."
"These transactions reflect that approach, enabling us to realise value from the sites while retaining full operational control." This deal effectively allows Asda to convert a portion of its substantial property assets into cash to reinvest in the business and manage its debt, all while maintaining its store presence.
