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Asda’s billionaire co-owner Mohsin Issa will step down from running the UK’s third-largest supermarket chain, which has lost market share to rivals in recent months.
Lord Stuart Rose, Asda’s chair, and Rob Hattrell, an executive at TDR, the private equity firm that owns a majority stake in Asda, will take over day-to-day responsibility for leading the supermarket.
Asda said on Wednesday that Issa would instead focus on running EG Group, the petrol station business he founded with his brother Zuber in Blackburn in 2001.
The move comes as Asda, which Walmart sold to the Issa brothers and TDR in a £6.8bn deal in 2020, continues a protracted search for a new chief executive.
In June, Zuber Issa said he would take a step back from both businesses, leaving Mohsin in charge of EG Group. He agreed to sell his holding in Asda to TDR Capital, giving the buyout firm a 67.5 per cent stake, and on October 31 is expected to step down from being co-chief executive at EG Group, becoming a non-executive director.
Earlier this year, Mohsin dismissed speculation about a rift with Zuber, saying the pair got on “exceptionally well” in a BBC interview, although the pair have since sought to neaten the division of assets between them.
Asda has lost out to competitors this year, leaving it with a 12.6 per cent share of the grocery market in the 12 weeks to September 1, down from 13.8 per cent in the same period a year earlier.
Walmart still holds a 10 per cent stake in Asda, but separating the chain’s IT systems from its former US majority owner has been complex and costly.
Rose said last month that he was “embarrassed” by Asda’s decline under his watch, and that Issa should step back from day-to-day operations. The chain needed “a different animal’, he told the Daily Telegraph newspaper.
Issa, who will remain a non-executive director at Asda, said on Wednesday he was proud of the “significant progress made to build a bigger and better Asda over the past three years”.
Rose said he “respected Mohsin’s decision to move on from his role at Asda, where his work is complete, to be the sole chief executive of EG Group”.
