Asda, Britain’s third-largest grocer, and EG are both owned by brothers Zuber and Mohsin Issa and private equity group TDR Capital.

The deal, which includes around 350 petrol stations and over 1,000 food-to-go locations, values EG at £2.27 billion, including debt, the groups said on Tuesday.

Asda has said it is aiming to overtake Sainsbury’s to become Britain’s No 2 supermarket and the deal will enable it to roll out Asda Express across the EG petrol estate.

Tesco leads the market with a 27.1% share, according to the most recent data by Kantar. Sainsbury’s holds 14.8% of the market, ahead of Asda on 13.9%.

Since the Issa brothers bought Asda in 2021, 166 EG sites have already been converted to the “Asda on the Move” format.

The deal comes as consumers grapple with a cost of living crisis that has left grocers trying to juggle the surging price of food with a need to pay higher wages, while also competing with German discount groups Aldi and Lidl.

Asda, which like rivals is competitive on the price of petrol sold at its large stores, said it planned to invest more than £150 million within the next three years to integrate EG.

Asda’s shareholders, which include its former owner US retail giant Walmart Inc, will provide around £450 million of additional equity for the deal, it said.

The grocer also reported like-for-like sales growth of 7.8% in the three months to the end of March compared with the previous year, while total revenues excluding fuel increased by 8% to £5.0 billion.