Walmart considers Asda float after abortive Sainsbury’s merger


Walmart, the world’s biggest retailer, is considering listing Asda on the London Stock Exchange.

Judith McKenna, the Walmart International chief executive, told managers at the British supermarket chain yesterday: “While we are not rushing into anything, I want you to know that we are seriously considering a path to an IPO — a public listing — to strengthen your long-term success.”

Talk of the float comes after the regulator blocked its planned £12 billion merger with Sainsbury’s last month. The decision closed a potential exit route for Walmart from the UK and led to speculation that Walmart would try to sell Asda to private equity or consider a listing for the business.

Walmart acquired Asda in 1999 in £6.7 billion deal.

Ms McKenna said that any preparations for a float would “take years”. It is the first time that Walmart has publicly addressed the future for Asda since the merger collapsed.

“Walmart does not have a one-size-fits-all approach to operating its international markets, but a consistent focus on strong local businesses powered by Walmart,” she said.

Asda has reported seven consecutive quarters of like-for-like sales growth thanks to a strategy focused on lower prices, more innovation in own-brand products, better store standards and improvements in its e-commerce operations.

Roger Burnley, Asda’s chief executive, told managers at the Leeds meeting that there would be £80 million of price cuts during the rest of 2019. He said that the supermarket chain’s strategy was working but that it would be harder to deliver without the synergies promised by the merger with Sainsbury’s.