Billionaire EG Group prepares $13bn US IPO

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Privately-backed gas station company EG Group has fired the gun to launch a stock market listing in New York, expected to come earlier this year.

The initial public offering, which could value the business at around $13bn, would allow TDR Capital to cash out some of its investments more than a decade after it support Blackburn’s billionaire sons Issa.

Zuber Issa, who founded EG with his brother Mohsin but resigned last year, told the Sunday Times newspaper that “the road map starts now” to the IPO, which is expected to materialize this year or next, he has considered different options. for a group at a given time.

EG could potentially float under the name of Cumberland Farms, the US convenience store retailer it bought in 2019, a person familiar with the matter confirmed.

The decision by two high-profile UK entrepreneurs and TDR to list their business in the US will be yet another blow for the London stock market, which has been struggling with a drought of new offerings and advanced vulnerabilities.

The brothers started with a single petrol station, near where they grew up in Blackburn, Lancashire in 2001. They have grown the business rapidly to over 5,500 locations in nine countries, some of they are by buying things caused by debts due to their bonds. with TDR.

TDR and Issas now own 50 percent each of EG.

Zuber said the choice of New York was influenced by the fact that despite the business’ roots in the north of England, more than half of its income was already in the US.

He also cited the presence of other competitors listed in North America, such as Canada’s Alimentation Couche-Tard and Nasdaq-listed Casey’s General Stores, which enables investors to measure performance. In 2022, there is it was a theory that Alimentation Couche-Tard and EG were in merger talks.

“If we still had (most of) our assets in the UK, we would have looked at a UK IPO,” Zuber told the Sunday Times.

EG no longer owns UK supermarkets and petrol fronts, after selling most of them to the Asda supermarket group, a sister business also owned by TDR Capital and Mohsin.

EG, where Zuber remains a shareholder and non-executive director, posted a profit of just under $1.1bn for the year to 31 December 2023, on revenue of $28.3bn. It also lowered its debt burden from $10bn in January 2023 to $5.3bn at the end of September last year.

Although the brothers decided to buy Asda from Walmart and TDR in 2020, Zuber sold his stake to a private equity group last year, creating a division.

Zuber suggested that his reason for withdrawing from EG was driven by TDR’s desire to pursue an IPO at a faster pace than he was comfortable with. Mohsin now runs EG as sole manager.

“TDR has supported EG since 2014 and anything EG decides (to do) is driven by the board and the decision the company makes,” said a person close to TDR.

“This idea is being driven by shareholders and it doesn’t make sense. It’s not about getting out, it’s about setting up the business for the next (stage) of growth.”

TDR and EG declined to comment.