Earlier this year Walmart began to entertain interested suitors for the Asda business but COVID-19 put those talks on hold. On Monday (July 20), Walmart said interest in Asda has risen and talks have resumed with some third-party investors.
Walmart has made no secret of its desire to divest of Asda, its grocery unit in the United Kingdom. Regulators nixed a merger between Walmart and Sainsbury’s for the Asda unit in April 2019.
”We believe now is the right time to explore options for a third party to invest in our business to accelerate the long-term delivery of our value strategy, both in stores and online,” Walmart said Monday in a prepared statement.
Walmart said the pandemic demonstrated Asda’s resilience and reflects the key role the retailer is playing to support communities. Walmart said while there is no guarantee the talks will end with a deal, the retailer has a clear international strategy. Walmart CEO Doug McMillon has said the international game plan will be strategic with a focus on Canada, Mexico, China and India.
Also on Monday, Walmart announced a $3.5 billion investment over the next five years to generate significant growth and make online and in-store shopping simpler, faster and more convenient for customers. This follows Walmart’s lead investment in Indian business Flipkart to infuse $1.2 billion of fresh capital into the growing business.
Shares of Walmart Inc. (NYSE: WMT) were trading slightly higher on Monday at $131.92, up 18 cents in the early afternoon session. Shares are up 11% year-to-date as Walmart is seen as one of the winners from then pandemic crisis. For the past 52 months, Walmart shares have traded between $102 and $134.13.