Asda set for massive expansion as OFT approves Netto purchase
Supermarket giant Asda will open 168 stores in 2011 after its acquisition of 194 Netto stores was cleared by the Office of Fair Trading.
The deal, when combined with 51,000 sq m of planned organic growth, will see Asda add 165,000 sq m of retail food space in the largest single year of growth in its history.
The competition watchdog approved the deal, saying Asda was allowed to keep 147 stores, but requiring it to sell 47 outlets from the Danish retailer’s estate - 25 upfront and the rest after the deal has gone through.
Asda has agreed to sell five stores to rival supermarket Morrisons, one to Iceland and 19 to independent chain Haldanes.
The retail giant also plans to build seven superstores, 10 supermarkets, five extensions to existing stores and four Asda Living stores in 2011.
National fit-out firms such as Styles & Wood, ISG Pearce, Bowmer & Kirkland and RG Group regularly work for Asda.
ISG last week announced turnover growth of more than 30 per cent, driven by strong growth in the fit-out and food retail markets.
But sources suggested Asda may look towards regional firms for much of the rebranding exercise. The Netto stores are an average size of 800 sq m.
Asda last week entered into a contract to acquire six stores from Focus DIY, which, subject to landlords’ approvals and appropriate local planning consents, will be converted into Asda supermarkets.
Chief financial officer Judith McKenna said: “The combination of acquiring 147 Netto stores together with our organic growth plans means we will be able to save customers more money than ever before.
“We will also create 1,500 jobs as we convert all of the Netto stores into Asda supermarkets.”
The first converted stores - in Worksop, Wakefield and Stainforth - will re-open their doors for business in May.
The OFT has also cleared the anticipated acquisition by Tesco, through One Stop Stores, of 76 Mills Group convenience stores.
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