The Netto stores will trade under the Asda Supermarkets banner (Photo: World of Oddy)

Asda Will Operate 147 Netto Stores in the UK

Asda, United Kingdom’s second-largest food seller, has announced that it had reached another major milestone in its purchase of Netto’s UK stores, having met the OFT’s (Office of Fair Traiding) requirement to agree purchasers for a number of Netto stores across the UK.

Subject to final regulatory approval, Asda will operate 147 Netto stores in the UK, adding 1.2 million square feet of space to its portfolio

The stores will trade under the Asda Supermarkets banner and will average 8,000sq ft in size. The retailer has said that customers will be able to complete a full weekly shop in each store. Asda intends to make sure prices in these smaller stores are identical to those Asda shoppers benefit from elsewhere.

Asda's CFO, Judith McKenna

Judith McKenna, Asda chief financial officer, who led the deal said: “Today is another key day in our plan to bring Asda to more customers in many more communities across the UK. We’re delighted that we’re one step closer to completing our acquisition of the Netto stores, which will allow us to provide even more space, choice and savings to our millions of customers in the UK.”

Following Asda’s initial announcement in May that it intended to purchase Netto’s stores in the UK, the OFT asked the retailer to agree purchasers for 47 stores across the UK, including a number of stores it had to identify a buyer for, (‘buyer upfront’) before the OFT would move to the next stage of its process.

Asda has now agreed a purchaser for all those ‘buyer upfront’ stores, and as a result, 39 Netto stores in the UK will be sold to grocery retailers Haldanes, Iceland and Morrisons, who will continue to run them as food stores. All of the colleagues in those stores have been briefed about the change.

Asda operates about 370 stores that primarily sell groceries and apparel

Only eight stores remain unsold at this stage, however Asda has confirmed it will be selling these in the coming months. 

The announcement is also a key milestone in Asda’s plan to create 7,500 new jobs across the UK in 2011 as the retailer plans to significantly increase the number of colleagues employed at each of their Netto stores, creating up to 1,500 jobs. Up to 500 of these jobs will be for shift leaders, which will give individuals the opportunity to take their first steps towards management roles.

About Asda Group Limited

American-owned Asda Group offers UK shoppers everything from frankfurters to diamond rings.

Owned by retail giant Wal-Mart Stores, Asda is the UK's second-largest food seller (behind Tesco). It operates about 370 stores (including about 25 Asda Living stores) that primarily sell groceries and apparel. The stores also sell CDs, books, videos, and housewares.

Since being bought by Wal-Mart in 1999, Asda has set off a price war in the UK by initiating Wal-Mart's aggressive "price-rollback" program and converting stores to Wal-Mart's super-centre format under the Asda-Wal-Mart banner.

About Netto Foodstores Limited

The UK arm of Denmark's Dansk Supermarked, Netto Foodstores operates some 195 hard-discount grocery stores throughout the UK, all easily recognized by their trademark black Scottie.

Netto's no-frills stores sell a limited range of food and non-food products (only 1,100 items) at deeply reduced prices. Its parent company has agreed to sell its UK subsidiary to grocery giant Asda to better concentrate on its supermarket business in Scandinavia and Northern Europe.

Dansk Supermarked is 68 percent owned by Mærsk Group (Public, CPH:MAERSK-A.CO).

Margaret E.L. Stacey
Editor Companies and Products
[email protected]
www.seafood.media

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