Asda owners, Mohsin and Zuber Issa, have been questioned in a letter from MPs after raising concerns that Asda’s ownership structure could be limiting the supermarket’s ability to support shoppers through the cost-of-living crisis.
Darren Jones, the chair of parliament’s business and trade select committee, wrote a letter to Mohsin Issa asking for details of the retailer’s corporate structure, capital investment and profit margins on petrol.
Jones also requested information on the Issa’s petrol forecourt operation, EG Group – who Asda acquired for an enterprise value of £2.27bn – and allegedly the purchase of two private jets for both brothers.
“The committee has concerns that the complex company structure within which Asda sits, and associated decisions on financing, may restrict your ability to help meet cost of living pressures on your customers,” Jones writes in the letter published on the committee’s website.
There is now ongoing fears that the structure of the Issa takeover, which doubled the retailer’s debts and increased interest payments from £90m in 2021 to more than £400m this year, has restricted the chain’s ability to invest in low prices.
Subscribe to Grocery Gazette for free
Sign up here to get the latest grocery and food news each morning
The grocery giant had recently invested £23m to cut the prices of 425 branded and own-label products by an average of 11% across a wide range of items, and has continued to offer a Kids Eat for £1 deal in its cafes.
An Asda spokesperson said: “Asda will continue to cooperate fully with the business and trade committee’s inquiry and will respond to its follow-up questions. Asda’s owners are committed to the long-term sustainable growth of the business and are investing in both supporting customers and colleagues during these challenging times.”
The retailer also became the first supermarket to publish local fuel prices online, following MP questioning over “sky-high” prices which have surged in recent months.
