Asda to open 110 convenience stores in February

Asda says it plans to open 110 convenience stores this month as it aims to become the second-biggest grocery retailer in the UK.

The supermarket will only actually open one new site, and will convert 109 shops it bought from the Co-op and EG Group to its Asda Express brand.

Many of the stores will be located in the south of England, where Asda has "traditionally been underrepresented".

It comes as part of a multimillion-pound investment by the supermarket.

Asda wants to rebrand all of the 470 convenience shops it took on as part of its Express brand by the end of March.

The supermarket had converted 259 locations by the end of January.

Back in 2022, the retailer purchased fuel forecourts and convenience shops from Co-op and the EG Group in a deal worth £438m.

The acquisition was approved nearly one year later after Asda agreed to sell more than a dozen Co-op forecourts to satisfy the competition watchdog.

• Asda to go cashless at more petrol forecourts

Since its acquisition by the billionaire Issa brothers and TDR Capital, Asda has been expanding into the rapidly growing food-to-go and convenience market, following the lead of the likes of competitors such as Sainsbury's Local and Tesco Express.

In a statement on Monday, Andy Perry, the vice president of convenience at Asda, said the shops were a "key component of our long-term strategy to become the number two player in UK grocery."

According to the latest figures from research firm Kantar, both Sainsbury's and Tesco gained market share over the 12 weeks to 21 January, compared with a year ago.

The UK's biggest retailer Tesco grew by 6.3% and now has a share of 27.6%, with Sainsbury's in second place with 15.7% and Asda with 13.7%.

Asda also faces fierce competition from the likes of German discounters Aldi and Lidl.

In January, discount chain Lidl was the fastest-growing supermarket in Britain for the fifth month in a row.

The Issa brothers, who made their fortune through their network of petrol forecourts, and the private equity firm TDR Capital have faced scrutiny since their acquisition of Asda three years ago.

While Asda was valued at £6.8bn, most of the purchase price was borrowed in a "leveraged buyout" deal.

MPs have questioned whether the billions of pounds of debt might be a concern as interest rates have gone up, and whether its finances are stopping it doing more to tackle soaring prices for consumers.

The supermarket previously said that its owners were "committed to the long-term sustainable growth of the business" and supporting customers and staff.

Mr Perry added on Monday: "Our teams have worked at pace to reach this point and we look forward to bringing Asda's quality and low prices to many more communities across the UK."

Asda Express stores will stock up to 3,000 branded and own-label products, it said.

The new shops opening in February will be spread across the country.