Billionaire brothers EG Group prepared a $13 billion IPO

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Private equity-backed oilfield company EG Group has fired the starting gun on a New York Stock Exchange listing, expected to come early this year.

The initial public offering could value the business at around $13 billion, allowing TDR Capital to cash out some of its investment more than a decade after Blackburn’s billionaire Issa brothers first backed it.

Zubair Isa, who co-founded EG with his brother Mohsin, but stepped down from management last year, told the Sunday Times newspaper that “the road map is just starting” for the group to consider various options for an IPO, which is expected to take place this year or next year.

In the year The American grocery store operator it bought in 2019 could float under the name Cumberland Farms, a person familiar with the matter confirmed.

The decision by two of the UK’s top entrepreneurs and their TDR business to list in the US will be another setback for the London Stock Market.

The brothers started in 2001 at a petrol station in their hometown of Blackburn, Lancashire. They rapidly expanded the business to over 5,500 sites in nine countries; This is partly because they bought it with debt. With TDR.

TDR and Issas now have about 50 percent each of EG.

Zuber said the New York election was driven by the fact that the business is based in the north of England, but more than half of its revenue is now in the US.

He noted that there are other listed rivals in North America, such as Canada’s Alimentary Cosh-Tard and Nasdaq-listed Casey General Stores, which could make it easier for investors to track performance. In 2022, there It was a hypothesis. As Alimentation Couche-Tard and EG were in merger talks.

“If we still had (most) of our assets in the UK, we would be looking more closely at a UK IPO,” Zuber told The Sunday Times.

EG no longer has any UK convenience stores and petrol fronts, most of which are owned by supermarket group Asda, a sister business also owned by TDR Capital and Mohsin.

For example, Zuber, a shareholder and non-executive, posted a profit of $1.1bn for the year on revenue of $28.3bn. It reduced its net debt burden to about $10 billion in January 2023 to $5.3 billion at the end of September last year.

Although the brothers only agreed to buy Asda from Walmart in 2020 through TDR, Zuber formalized the split by selling his stake to a private equity group last year.

Zuber pointed out that the reason he took a step away from EG was TDR’s desire to pursue an IPO more quickly than he was comfortable with. Mohsin now leads EG as the sole CEO.

“TDR has been supporting EG since 2014 and whatever EG decides (to do) is governed by the board and the company’s decision,” said a person close to TDR.

“The notion that this is stock-driven is far-fetched. It’s not about exiting, it’s about preparing the business for the next level of growth.”

TDR and EG declined to comment.