Supermarket Chain Sells Stores to Boost Finances
- Asda plans to sell around 20 supermarkets for £400m
- Appoints Eastdil Secured as property advisor for the sale
- Sale-and-leaseback deals popular among supermarkets for raising capital
- Similar moves made by John Lewis Partnership and Sainsbury’s in recent years
- Asda’s profits expected to take a hit due to increased spending on improvements
Asda, a UK-based supermarket chain, is planning to sell around 20 of its stores for £400 million as part of its turnaround plan. The company aims to lease the sold shops back for the next 20 years and has appointed property advisor Eastdil Secured to manage the sale. Sale-and-leaseback deals are a common method among supermarkets to raise capital. Similar moves were made by John Lewis Partnership and Sainsbury’s in recent years. Asda’s decision follows the return of former CEO Allan Leighton, who aims to revive the company’s struggling fortunes. The sale comes as profits are expected to suffer due to increased spending on price cuts, product availability improvements, and store estate refresh. An Asda spokesperson stated that sale-and-leasebacks have been a feature of the retail industry for many years, with maintaining a strong freehold base remaining central to their property strategy.
Factuality Level: 8
Factuality Justification: The article provides relevant information about Asda’s plan to sell around 20 stores for £400m to fund its turnaround plan and mentions similar actions taken by other supermarkets in the past. It also includes a statement from an Asda spokesperson. However, it briefly mentions unrelated cyber attacks on M&S, Co-op, and Harrods at the end which could be considered as digression.
Noise Level: 4
Noise Justification: The article provides relevant information about Asda’s plan to sell stores for funding its turnaround plan and mentions similar actions by other supermarkets. However, it briefly touches on unrelated cyber attacks at the end which adds some noise.
Financial Relevance: Yes
Financial Markets Impacted: No
Financial Rating Justification: The article discusses Asda’s plan to sell around 20 stores for £400m to fund its turnaround plan and mentions sale-and-leaseback deals by other supermarkets. It also talks about the impact on Asda’s profits due to price cuts, product availability improvements, and store estate refreshment.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Extreme Rating Justification: There is no extreme event mentioned in the text and it does not meet the criteria of an extreme event happening in the last 48 hours.
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