Asda
Asda Stores Limited, trading as Asda and often styled as ASDA, is a British supermarket and petrol station chain. Its headquarters is located in Leeds, England. The company was incorporated as Associated Dairies and Farm Stores in 1949. It expanded into Southern England during the 1970s and 1980s, and acquired Allied Carpets, 61 large Gateway Supermarkets and other businesses, such as MFI. It sold these acquisitions during the 1990s to concentrate on the supermarkets. It was listed on the London Stock Exchange until 1999 when it was acquired by large American retailer Walmart for £6.7 billion. Asda was the second-largest supermarket chain in the United Kingdom between 2003 and 2014 by market share, at which point it fell into third place. As of January 2025 its market share in the UK is 12.6 per cent.
Besides its core supermarkets, the company also acts as a white label payment card provider offering assistance for insurance and payment services under the Asda Money brand and also has a mobile virtual network operator.
In February 2021, the Issa brothers and TDR Capital acquired Asda, with Walmart retaining "an equity investment" in Asda, a seat on the board and "an ongoing commercial relationship". The deal came after a merger with Sainsbury's was rejected by the Competition and Markets Authority in April 2019. TDR Capital became the majority owner of Asda in November 2024 after buying Zuber Issa's 22.5 per cent holding, owning 67.5% of the company; Mohsin Issa owns a 22.5% stake but discontinued running the company in September 2024.
History
Early years
The Asquith family were butchers based in Knottingley, West Yorkshire. In the 1920s, they expanded their business to seven butcher shops in the area. Their sons, Peter and Fred, later became founding members of Asda.Around the same time, a group of West Riding dairy farmers, including the Stockdale family and Craven Dairies, joined under the banner of J. W. Hindell Dairy Farmers Ltd. The company diversified in 1949 to become Associated Dairies and Farm Stores Ltd, with Arthur Stockdale as the managing director.
1960s and 1970s
In 1963, the Asquith brothers converted an old cinema, the Queens in Castleford, into a self-service supermarket. Another followed in the old indoor market at Edlington. Both stores traded under the name of 'Queens'. Their next store was a purpose-built supermarket in South Elmsall.In 1965, the Asquith brothers approached Associated Dairies to run the butchery departments within their small store chain. A merger was proposed and the Asquiths' business was joined with Noel Stockdale's to form a new company, Asda .
By 1967, the company had set up a store in Billingham, County Durham. By 1969, Noel Stockdale bought out the Asquith brothers' stake and became chairman of the company.
Asda took advantage of the abolition of retail price maintenance to offer large-scale, low-cost supermarkets. This was aided by the decision to acquire three struggling US-owned branches in the mid-1960s of the GEM retail group. The Government Exchange Mart stores in Preston, Lancashire, Cross Gates, Leeds and West Bridgford, Nottinghamshire, had accumulated losses of £320,000 and offered to sell the stores for 20% of whatever Asda could recoup as losses from the Inland Revenue. They received the whole amount back. The rent was only 10 shillings per square foot on a 20-year lease, with no rent reviews, Asda increased GEM's £6,000 per week sales to around £60,000 per week in just six months with the new stores named as Asda.
During the 1970s, with over 30 stores in the north of England, Asda began expanding south, with the opening of new stores in the Estover area of Plymouth, Devon and Gosport, Hampshire in 1977. In 1978, Asda acquired Allied Carpets.
In 1982, the first London store opened in Park Royal, near Ealing. The Isle of Dogs and Charlton, London stores followed on rapidly thereafter.
1980s and 1990s
In 1984, managing director John Hardman made attempts to halt Asda's decline, which included the introduction of Asda branded products. In 1985, Asda merged with MFI and the group was renamed Asda-MFI Group plc.Asda established its headquarters at "Asda House". The site was officially opened in 1988 by the then Prime Minister, Margaret Thatcher.
By the end of the 1990s, the 'Asdale'-named clothing range was replaced by the clothing ranges from the newly formed George Davies partnership with Asda.
Near bankruptcy and merger prospects
With stores mainly based in the North of England, the newly focused food retail group expanded further south in 1989 by purchasing the large format stores of rival Gateway Superstores for £705 million. The move left the company overstretched as a result, and by 1991, it found itself in serious financial trouble with over £1 billion of debt; compounding the situation further was a declining customer base, which was mainly caused by Asda's focus on moving upmarket resulting in prices rising to levels significantly higher than competitors.The company's first response was to change its management; chairman John Hardman was ousted in June 1991 and was replaced by Patrick Gillam, and Archie Norman was appointed chief executive in October. Asda then completed a rights issue in November 1991 that raised £357 million and cut the company's debts to £668 million. Underperforming stores were initially converted to a new discount format called "Dales" but this had been scrapped by 1998. In 1993, Asda completed a second rights issue that raised a further £347 million and began selling off some of its assets; some stores were sold to competitors, and the Allied Carpets chain was sold to Carpetland. By 1995, the company had returned to profitability and had virtually wiped out its debt – this is cited as one of the most successful turnarounds in British retail history.
Norman succeeded Gillam as chairman upon the latter's retirement in 1996, appointing then-deputy Allan Leighton as chief executive, and began to remodel Asda's stores along the lines of Walmart, the world's largest retailer. Leighton travelled to Bentonville, Arkansas, to assess and photograph the systems and marketing deployed by Walmart. In 1998, following the Walmart model, Asda began opening larger 'Hypermarket' stores as well as introducing pharmacies and cafes to its stores. At the same time, merger discussions were taking place between Asda and other retailers such as Safeway and Kingfisher plc; both collapsed without an agreement being reached, but in 1999, a second round of discussions with Kingfisher later reached an agreement for a £5.4 billion merger that would have both created the United Kingdom's largest multi-category retailer and enabled Asda to begin operating stores throughout Europe.
2000s and 2010s: Walmart years
A merger deal was abandoned when Walmart outbid Kingfisher to purchase Asda for £6.7 billion, which was completed on 26 July 1999 in a move that was initially speculated by British media outlets as a potential corporate raid. As Walmart were keen on entering the British market, Bob Martin, Walmart's president of international operations, lobbied Prime Minister Tony Blair on planning issues.In 2005, amid reported concerns within Walmart about a slippage in market share, partially due to a resurgent Sainsbury's, Asda's chief executive, Tony De Nunzio left, and was replaced by Andy Bond. In 2005, Asda expanded into Northern Ireland by purchasing 12 former Safeway stores from Morrisons.
In December 2007, Asda, Sainsbury's and various other retailers and dairy firms admitted to the price fixing of dairy products between 2002 and 2003. The price operation was calculated to have cost consumers around £270 million. Asda commented, "Everyone at Asda regrets what happened, particularly as we are passionate about lowering prices. Our intention was to provide more money for dairy farmers, who were under severe financial pressure at the time." In total, Asda was fined £18.21 million by the Office of Fair Trading for its part in the cartel.
File:Holtparkasdaleedsreload.jpg|thumb|A smaller, older Asda supermarket in Holt Park, Leeds in 2008. The store has since been reclad.
Asda's property development arm, Gazeley Limited, was sold to Economic Zones World, a Dubai World subsidiary, in June 2008 for in excess of £300 million.
In November 2008, there were reports that Asda was to buy Irish retailer Dunnes Stores.
In August 2009, Walmart sold Asda for £6.9 billion to its Leeds-based investment subsidiary Corinth Services Limited. The deal was described as part of a "group restructuring" and meant that Asda remained under the control of Walmart.
Advertising issues
In 2009, the ASA challenged whether a press ad which showed a large green arrow bearing down on a smaller yellow arrow with a crumpled tip and "Asda 2955 products cheaper" should set out how the general price claims made in the ads could be verified by consumers. Because it was not possible for consumers or competitors to check the products and prices used in the comparison using mySupermarket.co.uk, and because the ads did not set out how consumers and competitors could check that information for themselves, the ASA concluded that the ads did not satisfy the criterion of verifiability as defined in the 2006 European Court of Justice ruling, and were therefore in breach of the advertising codes. The ASA ruled that, due to the significant limitations and qualifications to the basis of the price comparison which were not included in the ad, or in the terms and conditions on Asda's website, the approach taken in making the comparisons was unfair and misleading.In 2009, the ASA ruled that an advert for a proposed development in New Barnet was misleading, because it compared the floorspace of the development with the floorspace and additional buildings of a Sainsbury's store and with an unapproved Tesco plan.
In 2010, a national press ad for Asda on a double-page spread was headed "The big Asda Rollback" with headings stating "Lower prices on everything you buy, week in week out" with equal prominence to a column headed "Lower prices than any other supermarket"; that the arrows underneath the heading "Lower prices than any other supermarket" compared prices at Asda with prices at Sainsbury's, Tesco and Morrisons. The ASA ruled that in the context in which it appeared, it was ambiguous in that it could be interpreted either as referring to price reductions that had taken place within Asda or to price comparisons with the named competitors. In addition, because the ad did not explain that the price reductions had not necessarily taken place in the week that immediately preceded the ad, they concluded that the headings which stated the number of price reductions that had taken place in each product category were misleading. The ASA also concluded that the "Lower prices than any other supermarket" claim in the advert was misleading. The ASA disagreed, and referred to the claim "Everything is at least half price!" was likely to imply to viewers that all toys were included in the sale. As all toys were not included in the sale, and in the absence of a qualifying statement, the ad was misleading.
A press ad, which appeared on 26 September 2011, was headlined "Only one supermarket is ... always 10% cheaper or we'll give you the difference guaranteed". However, at the top of the ad there was a banner that contained the claims "SALE", "Half Price", "Price Drop", "50% off", "1/2 price", "cheap" and that part of the headline claim "... always 10% cheaper" appeared in bold text in the middle of the ad. The ASA considered the banner, together with the headline was likely to be interpreted by consumers as claims that referred to the price of Asda goods. Since consumers could interpret that claim as one which guaranteed to refund the difference, should Asda not be the lowest on price, the ASA considered the presence of the claim "only one supermarket is always 10% cheaper" could create the impression that Asda were always 10% cheaper and would be interpreted as a 'lowest price' claim. The ASA therefore concluded that the advert was misleading. It also noted the footnote explaining the APG contradicted Asda's absolute claim that they were always the lowest on price, and that the disclaimer was also misleading.
The ASA ruled in 2011 that a television advertisement and two national press ads did not give sufficient prominence to the fact that exclusions applied. Another advertisement from Asda, in which it featured World Cup related products and an Asda price guarantee was misleading as the World Cup related products were exclusive to Asda and not, therefore, available at Morrisons, Tesco or Sainsbury's.