Mohsin and Zuber Issa have ditched a £750 million deal to buy Asda’s petrol stations, just months after it was cleared by the competition watchdog.
The billionaire brothers had planned to partly fund their £6.8 billion takeover of the supermarket last year by selling its forecourts to EG Group, which they own with TDR Capital.
They financed the rest with £3.5 billion of new debt, plus a £749 million loan and £800 million of equity.
According to The Times, the Issas will now add £500 million of debt onto Asda to plug the resulting black hole.
READ MORE: Asda billionaires clear takeover hurdle with forecourt sale
The Competition and Markets Authority cleared the Issa’s buyout of Asda in June, requiring the brothers to sell 27 petrol stations.
Despite agreeing to sell the forecourts to Park Garage Group this month, EG claimed the “commercial information” shared after this date killed off the deal.
“EG and Asda have decided they will no longer proceed with the transaction,” its statement continued.
As a result, EG will redeem a £675 million bond, while Asda plans to settle the financing through £250 million cash on hand and £500 million on senior secured debt.
An insider said Asda could support the additional debt as it was keeping the income from its petrol stations.
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