Asda’s billionaire owners the Issa brothers have reduced investment at their petrol forecourt business in a bid to pay down mounting debts.
EG Group slashed its investment into growth by 37% last year to £191m in what executives termed a “controlled reduction” to maximise liquidity, The Telegraph reported.
It did not explicitly lay out where capital expenditure was cut but the business is said to have expanded its US operations “with minimal capital spend” last year compared to the heavy investment reported in 2022.
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The cutback in funding comes as EG races to pay down its debt pile in the face of high interest rates.
The group has been selling off its assets to raise extra funds, including offloading its UK business to Asda as well as a $1.5bn sale and leaseback deal of its US east coast property portfolio.
EG is understood to have paid down its debt pile from £7.89bn ($10bn) at the start of 2023 to £4.73bn ($6bn) by the end.
In a joint statement, Mohsin and Zuber Issa said they had “strengthened” EG Group’s balance sheet and were committed to cutting debt further.
However, the brothers have come under close scrutiny of the high levels of debt within their businesses. Asda’s debt pile stands at around £4.2bn.
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