Asda’s private equity owners TDR Capital have been questioned by MPs over the supermarket giant’s debt pile, a lack of transparency and workers’ rights.
The Business and Trade Comittee hearing, which took place yesterday (9 January), saw the firm’s bosses grilled over whether a “debt bomb” was forming under Asda due to the £4.2bn of debt that it holds in a higher interest rate environment.
TDR managing partner Gary Lindsay said: “While it’s been great for the Asda business to enjoy a lower cost of capital for the last three or four years, that was never a central tenet of us investing in the business.
“We feel more than comfortable with the leverage level at Asda and we feel more than comfortable that when we decide to refinance the balance sheet in the next two or three years, the business can absorb the cost.”
Lindsay insisted that the grocer was delivering “economic value back to customers” and that it had reduced prices by 9% since its takeover in 2021.
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Labour MP and the chair of the committee Liam Byrne said that as most of Asda’s entities were registered in Jersey, they were unable to access accounts.
TDR Capital deputy general Emma Gilks stressed that Asda was “extremely transparent,” and the company admitted that the jurisdiction provides more flexibility when it sells of the Asda as there would be no stamp duty due.
Labour MP Ian Lavery also grilled the firm over its unwillingness to meet with GMB Union after it tried to organise discussions between Asda over a planned strike caused by a “toxic atmosphere” at its Gosport store.
Lindsay told MPs that TRD Capital takes its relationships with colleagues “extremely seriously” and was not against workers being in a union. The proposed Gosport strike was this week postponed to allow last-ditch talks between the union and the retailer to take place.
