EG Group IPO: what to know and how to buy shares

When could the EG Group IPO take place?

According to several reputable news outlets, EG Group’s owners, the billionaire Issa brothers, are planning to list the company in the United States at a valuation of circa £13 billion later in 2025.

The launch is apparently being brought to allow Mohsin and Zuber Issa — and their private equity backer since 2015, TDR Capital — to realise an exit.

Reportedly, the brothers are trying to completely separate their wealth, with investors speculating there may be a personal conflict. For context, the pair have already parted ways at Asda, which could also see an Initial Public Offering this year. However, in a BBC interview last March, speculation of a rift was denied.

While the brothers were born in Lancashire, the company is likely to list in the US due to the deeper liquidity and the fact that the country is now the business’s largest market. This continues a worrying trend for London, which has lost Ashtead, Flutter, Tui, Arm and Klarna to the US in recent months.

How to buy EG Group shares if the company lists

If EG Group do end up listing in the US, you can buy their shares from £0 commission with us. That's the rate if you've traded 3+ times in the previous calendar month, otherwise our standard fee is £10.

You'll be able to invest in EG Group right away on the day of the listing.

1. Do your research on IPOs
2. Open a share dealing account
3. Search for EG Group on our share dealing platform
4. Choose the number of shares or amount of money you wish to invest
5. Place your deal

When dealing shares, you own the stock and become a shareholder in the company. You'll profit if the share price rises above the point at which you bought, or potentially from any dividends paid. You could get back less than you put in.

You can also trade the EG Group IPO using leverage through a variety of products with us. This means you could gain or lose money quickly and could end up losing more than your initial deposit. This is higher risk and requires thorough risk management.

Read more about IPOs:

• Upcoming IPOs to watch
• How to trade or invest in IPOs

What will EG Group be valued at and what will the share price be?

According to The Daily Telegraph in December 2024, while the deal remains at an early stage, the company will be valued at circa $14.3 billion, which is 13 times its underlying earnings of $1.1 billion in 2023. For perspective, EG Group generated $28.3 billion in revenue in 2023 from more than 5,500 locations — though it no longer has any sites in the UK.

A recent MergerMarket report indicates that Rothschild, Barclays, Goldman Sachs, JP Morgan and Morgan Stanley have all been tapped to take part in the IPO.

While the valuation may seem conservative, it’s worth bearing in mind that the company still has a debt pile of some $5.3 billion, though this has almost halved since peaking at $10 billion in January 2023 — with Moody’s recently upgrading the company’s outlook from negative to stable.

In its most recent quarterly results, underlying EBITDA increased by 8% year-over-year to $300 million, driven by grocery and merchandise earnings growth in the USA. Meanwhile, its bridging facility has now been fully repaid.

You might imagine a share price of circa $100 at listing, to match premium expectations, though this is only an estimate, and the business may be marketed lower to attract more demand.

What is EG Group’s business model?

EG Group’s business model in centred around retail and convenience shops, spanning fuel, food and general services. It’s most well-known for operating petrol stations under global brands like BP, Shell, Esso and Texaco — usually owning or leasing the forecourts and associated retail spaces.

It’s also a mainstay in foodservice, operating franchises outlets in partnership with global brands like Burger King, KFC, Starbucks and Subway. The model combines the petrol station forecourts with the foodservice brands in the same location, leveraging increased profitability. EG Group also partners with grocery brands like SPAR and Carrefour, delivering convenience shops within its service stations.

The company maintains a presence across North America, Europe and Australia, reducing its dependence on any single market, while also allowing for the scaling of successful novel concepts across different countries.

There are arguably two key market advantages: the franchise model, which gives EG Group reputable brand recognition and established customer bases without the risk of developing its own brand portfolio, and the convenience model, which combines fuel, food and retail in one location making an EG Group site more popular than any competitor.

It’s also worth noting the economies of scale associated with having thousands of sites — and the ability to expand through acquisitions as the business grows.

For perspective, EG Group was launched at a single petrol station in Bury in 2001 and has since expanded into a massive enterprise, driven by acquisitions financed by cheap debt. This strategy was possible because through the 2000s the oil majors continued to divest forecourts to the company in favour of increased investment in oil production and refining.

Perhaps most famously, EG Group spent £1.7 billion in 2018 to buy 762 convenience shops including the Turkey Hill, Loaf 'N Jug, Kwik Shop, Tom Thumb and Quik Stop brands from US titan Kroger to cement its position in the USA. It also acquired TravelCenters of America’s 225 Minit Mart shops in 2018, and then a year later bought Cumberland Farms and its nearly 660 shops in the Northeast US and Florida.

Today, EG Group operates 1,500 convenience shops covering several brand names across 30 US states, making the country its largest market. However, the company has now exited the UK, having sold off the majority of its UK operations to Asda for £2 billion in 2023, and then selling its remaining sites to co-founder Zuber Isser in late 2024, leaving his brother Mohsin Isser as sole CEO.

Why are there EG Group ethical concerns?

There are several ESG issues to consider with EG Group — perhaps most prominently, the carbon emissions associated with retailing fuel. Critics have in the past called on the company to invest more in renewable energy solutions and EV infrastructure.

Some employees have also complained about poor working conditions at some EG Group sites — and there have also been concerns about the larger company’s impact on smaller local businesses which struggle to compete with its economies of scale. The Issa brothers have also been accused of setting up companies in Jersey to avoid paying UK tax, though the pair have denied the allegations.

It’s worth noting that many rivals share similar ESG concerns.

EG Group-related investments

While investors wait for the EG Group IPO, there are plenty of other options to consider. Tesco and Sainsbury's may be of interest as the two retailers control a large portion of the petrol station forecourt market in the UK. You can also invest in Shell and BP which both continue to own and operate forecourts alongside their key interests in oil production and refining.

You could also invest in foodservice brands which franchise in partnership with EG Group, such as Burger King, Starbucks and Subway.

EG Group IPO summed up

• EG Group plans to list the company in the United States at a valuation of circa £13 billion later in 2025
• The business model in centred around retail and convenience shops, spanning fuel, food and general services. It’s most well-known for operating petrol stations under global brands
• EG Group spent £1.7 billion in 2018 to buy 762 convenience shops from US titan Kroger to cement its position in the USA
• While the deal remains at an early stage, the company will be valued at circa $14.3 billion, which is 13 times its underlying earnings of $1.1 billion in 2023
• EG Group generated $28.3 billion in revenue in 2023 from more than 5,500 locations across three continents, though it no longer has any sites in the UK