Co-op has sold its petrol forecourt business to Asda in a deal worth £600 million.
The group said the move will allow it to focus on its core convenience proposition while strengthening its balance sheet.
The transaction includes 129 petrol forecourt sites with grocery retail shops of between 1,500 and 3,000 square feet. This represents 5% of Co-op’s retail estate of 2,564 stores. Asda said the purchase will create a new and distinct format for its business in the convenience market.
Asda will pay £438 million in cash for the assets and take on around £162 million of lease liabilities
Co-op will use the proceeds from the sale to invest in its core convenience business and grow its wholesale, franchise and ecommerce operations. It will also invest in pricing, store operations, technology and logistics and reduce its net debt.
The 2,300 staff members currently employed in the Co-op stores will transfer to Asda’s employment under TUPE transfer following the sale’s completion and a transition period.
