Walmart and its U.K. supermarket arm Asda are reportedly looking for an investment from a third party, after a failed attempt to merge with competitor Sainsbury’s, according to a report by Reuters.
Walmart said discussions with potential buyers of a stake in the supermarket chain followed “inbound interest,” but that “no decisions have been made.”
“We are currently considering whether there is an opportunity for a third party to invest in Asda, alongside Walmart, in order to support and accelerate the delivery of Asda’s strategy and position Asda for long term success,” Walmart and Asda said on Wednesday (Feb. 26).
The potential buyers, Walmart said, share the company’s desire to grow the business in the region. Asda is the number three supermarket in the U.K., behind number one Tesco and number two Sainsbury’s.
Walmart purchased Asda for $8.7 billion in 1999, and after the merger with Sainsbury’s didn’t go through, it said that it was considering putting the grocery store on a different stock market listing.
“While we are not rushing into anything, I want you to know that we are seriously considering a path to an IPO — a public listing — to strengthen your long-term success,” Judith McKenna, Walmart International CEO, told Asda managers at an event in Leeds in northern England in May.
The Chief Executive of Asda, Roger Burnley, said last year that an initial public offering (IPO) could happen for Asda in the next two years.
McKenna said the firm treats all of its properties differently, but that it has a main focus regardless of location.
“Walmart does not have a one-size-fits-all approach to operating its international markets, but a consistent focus on strong local businesses powered by Walmart,” said McKenna.
On Wednesday, Walmart said an IPO was a good long-term plan for Asda.
“Asda is a great business with a clear strategy for the future and Walmart is committed to ensuring it has the resources and support it needs to deliver that strategy,” Walmart said.