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Private equity-backed gas station company EG Group has fired the starting gun for a listing on the New York Stock Exchange, expected to happen early this year.
The IPO, which could value the company at about $13 billion, would allow TDR Capital to divest some of its investments more than a decade after it first backed the billionaire Issa brothers in Blackburn.
Zuber Issa, who co-founded EG with his brother Mohsen but resigned from management last year, told the Sunday Times that “the roadmap starts now” for the IPO, which is expected to happen this year or next, after considering various options for the group for some. the time.
EG will likely float under the name Cumberland Farms, the US convenience store operator it bought in 2019, a person familiar with the matter confirmed.
The decision by two of the UK's most prominent businessmen and TDR to list their businesses in the US will be another blow to the London stock market, which has been grappling with a drought in new offerings and high-profile defections.
The brothers started with a single petrol station, near where they grew up in Blackburn, Lancashire in 2001. They then scaled the business with dizzying speed to more than 5,500 sites in nine countries, partly through debt-fueled acquisitions facilitated by their relationships. With TDR.
TDR and Issas now each own about 50 percent of EG.
Zuber said the choice of New York was driven by the fact that despite the company's roots in northern England, more than half of its profits were now in the United States.
He also noted the presence of other competitors listed in North America, such as Canada's Alimentation Couche-Tard and Nasdaq-listed Casey's General Stores, which makes it easier for investors to gauge performance. And in 2022 there It was speculation Alimentation Couche-Tard and EG are in merger talks.
“If we still had (the majority of) our assets in the UK, we would have taken a closer look at a UK IPO,” Zuber told The Sunday Times.
EG no longer has any convenience stores and petrol forecourts in the UK, after selling the bulk of it to supermarket group Asda, a sister company also owned by TDR Capital and Mohsin.
EG, where Zuber remains a shareholder and non-executive director, posted underlying earnings of $1.1 billion for the year ending December 31, 2023, on revenue of $28.3 billion. It also reduced its net debt burden from about $10 billion in January 2023 to $5.3 billion at the end of September last year.
Although the brothers only finalized the deal to buy Asda from Walmart with TDR in 2020, Zuber sold his stake to a private equity group last year, formalizing the split.
Zuber suggested that the reason for EG's reversal was driven by TDR's desire to pursue the IPO at a faster pace than it was comfortable with. Mohsen now runs EG as the sole CEO.
“TDR has supported EG since 2014 and anything EG decides (to do) is driven by the board and the decision the company makes,” a person close to TDR said.
“The idea of being shareholder-driven is completely far-fetched. It's not about exiting, it's about preparing the company for the next stage of growth.
TDR and EG declined to comment.
