Banks Behind Asda Buyout Prep $5 Billion Debt Deal for Grocer

(Bloomberg) -- Financing to back the potential buyout of U.K. grocery firm Asda Group Ltd. by a private equity sponsor could total just under four billion pounds ($5 billion), according to people familiar with the information.

Three bidders are still involved in the process after final bids were submitted on Monday, Apollo Global Management, Lone Star Global Acquisitions Ltd, and TDR Capital LLP, the people familiar said, asking not to be identified because the matter is private.

One of the options being considered by Apollo is a real estate-backed financing rather than a typical LBO debt package, some of them added.

TDR’s exposure to U.K. retail includes gas station forecourt operator EG Group, a repeat issuer in the leveraged debt market. Earlier in the year, Bloomberg reported that TDR had teamed up with EG Group for the Asda bid.

Spokespeople for Apollo, TDR and Lone Star declined to comment.

Owner Walmart Inc. restarted the sale of the business after putting it on hold when the pandemic struck. If the deal goes ahead it may add a large debt financing to what is otherwise a relatively slim pipeline of upcoming M&A issuance expected to be sold this year.

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