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Walmart received several first-round bids for a majority stake in the British supermarket chain Asda, which could fetch at least £7 billion, per Bloomberg.
Why it matters: This is a big test of whether private equity can still secure large debt financing packages at attractive rates.
- Suitors are Apollo Global Management, Lone Star Funds, and TDR Capital (paired with EG Group).
The backdrop: Asda and rival Sainsbury’s last year tried to merge, but were blocked by U.K. competition regulators. Walmart subsequently considered a public listing, but seems to have instead settled on a sale process.
The bottom line: "U.K. grocers are facing surging demand from shoppers stockpiling essential items. That’s made them a bright spot in the consumer industry, which overall has been hurt as the coronavirus outbreak leads to shop closures and less foot traffic. Still, the high demand for everyday goods is putting immense pressure on supply chains, and over the weekend some of the country’s largest supermarket chains published a letter in national newspapers asking consumers to stop stockpiling," per Bloomberg.